Not debt
No loan, no repayment schedule, no impact on credit.
Invoice Factoring on a 30 to 60 day cycle. Turn unpaid invoices into working capital the same week. No new debt, no collateral beyond the invoices themselves.
Invoice Factoring lets your business access the value of unpaid customer invoices without waiting for the customer to pay. You complete the work and invoice the customer as usual. Patch advances most of the invoice value to your business within days. When the customer pays, the invoice settles and the transaction closes.
Factoring isn't borrowing money. You're not taking on new debt. You're selling the right to collect on invoices you've already earned, in exchange for getting paid sooner. There's no loan to repay, no monthly debt service, no impact on your borrowing capacity at the bank. The transaction is structured against the receivable, not against your business.
For labor-intensive businesses where payroll runs every two weeks but customer payments take six to ten, factoring is what closes the gap.
No loan, no repayment schedule, no impact on credit.
Days from invoice submission to working capital in your account.
Not against your business balance sheet or personal assets.
The factoring process is designed to be operationally light. You don't change how you bill customers, how you account for revenue, or how you run your business. The mechanism sits between when the work is invoiced and when the customer eventually pays. From your business's perspective, the cash arrives sooner; everything else looks the same.
Same workflow, same billing terms, same accounting practices.
Through the platform, on your schedule. No batch minimums, no commitment to factor every invoice.
Funds deposit directly to your business account. Use them for payroll, materials, operations, anything the business needs.
The remaining invoice value, minus the factoring fee, settles. No follow-up debt, no rollover.
Not just a way to make payroll. A way to take more work, build more stability, and negotiate from a stronger position.
Most labor-intensive businesses turn down jobs they could profitably win, because the cash to fund payroll and materials for the new job doesn't exist until the current jobs pay. Factoring lets you fund the next job without waiting for the current one to settle.
Owner draws, personal credit cards, lines of credit secured against the house. The hidden cost of waiting on customer payments is the founder's personal balance sheet. Factoring takes that load off and puts it where it belongs: against the receivables.
Vendors give better terms to customers who pay early. Material suppliers offer discounts. Subcontractors prioritize work for businesses they trust to pay. Factoring puts cash in your account on your schedule, which changes how you negotiate everything downstream.
Working capital options each solve different cash flow problems. Here's where factoring fits, and where another tool might make sense.
| Invoice Factoring | Bank line of credit | SBA / term loan | Business credit card | Fintech line of credit | |
|---|---|---|---|---|---|
| Structure | Advance against the receivable | Revolving debt | Term debt | Revolving debt | Revolving debt |
| Debt on your books | No | Yes | Yes | Yes | Yes |
| Speed to funds | Days | Weeks | Weeks to months | Same day | Days to weeks |
| Approval based on | Customer creditworthiness, invoice quality | Business credit, financials, collateral | Business credit, financials, plan | Personal credit, sometimes business credit | Bank data, revenue, credit |
| Personal guarantee | Sometimes required | Often required | Required | Required | Often required |
| Cost structure | 1–5% per 30 days | Variable APR, often 8–15% | Fixed APR, often 10–14% | APR 20–30%+ | APR 15–30%+, fees |
| Scales with growth | Yes, as receivables grow | Capped at credit limit | Fixed at origination | Capped at credit limit | Capped at credit limit |
| Best for | Labor-intensive businesses where payroll runs faster than customer payments | Established businesses with clean financials and collateral | Capital projects, asset purchases, longer paybacks | Smaller, recurring operating expenses | Businesses with strong bank-data signal |
Cost ranges are indicative of typical market rates. Actual rates vary by lender, your credit profile, and other factors. Patch's specific rates are determined during onboarding.
Factoring isn't right for every cash flow problem, and that's okay. If you're not sure which tool fits your business, talk to us. We'll help you think it through.
Labor-intensive verticals each have their own factoring complexity. Construction has lien waivers and progress billing; transportation has detention pay and freight submissions; staffing has multi-week payroll cycles and per-placement billing.
And other labor-intensive operations where the math has its own shape.
Yes. Standard factoring includes customer notification because customers ultimately pay invoices to the factoring partner. In labor-intensive verticals, this is widely understood and accepted; many of your customers already work with vendors who factor. Patch keeps the notification process professional, and the customer relationship stays with you.
No. Factoring is a cash flow management tool that thousands of healthy, growing businesses use to align their working capital with their operational reality. In labor-intensive verticals, factoring is closer to standard practice than to a last resort. It signals operational sophistication, not financial distress.
No. Patch is free to access and there's no long-term commitment. You factor the invoices that make sense to factor, on your schedule, with no minimum volume requirement.
No. You decide which invoices to factor and when. Some businesses factor everything; others factor selectively based on customer payment terms or cash flow timing. The platform works around your decisions, not the other way around.
Most B2B invoices from established commercial customers qualify. We work with you during onboarding to confirm which of your receivables are eligible and at what advance rate. The specifics depend on your customers, your industries, and the invoice structure.
Start a conversation with the Patch team. We'll talk through your cash flow patterns, your customer mix, and whether factoring would actually solve the problem you're solving.