BlueVine Review: Best B2B Factoring Service

BlueVine Review: Best B2B Factoring Service

Credit: BlueVine

Our 2017 research and evaluation of factoring services leads us to again recommend BlueVine as the best B2B factoring service. We chose BlueVine from dozens of factoring companies. To understand how we made our decision, and to see our methodology and a list of factoring services, check out our best picks page.

BlueVine offers factoring services to small B2B companies. It doesn’t require you to sign a lengthy contract, and there are no application, origination or hidden fees. There’s no monthly minimum, and you can select which invoices you want to factor. In addition to its factoring service, the company offers business lines of credit that have low rates and no prepayment penalties.

BlueVine costs 0.5 to 1 percent per week of the advance, which is 85 to 90 percent of the total invoice value. After BlueVine receives the invoice payment from your customer, it pays you the remaining balance, minus fees. Businesses may qualify to factor up to $5,000,000 of invoices through this factoring service.

BlueVine takes a holistic approach to evaluating your business’s creditworthiness. It looks at multiple facets of your business, including cash flow, your personal and business financial history, the quality of your customers, and whether your invoices are factorable.

  1. Your business: To qualify for BlueVine’s invoice factoring, you must be in business for at least three months, have a minimum revenue of $10,000 per month and have a personal credit score of 530 or better. Your customers must be other businesses or the government.
  2. Your customers: Customers whose invoices you wish to factor must be U.S.- or Canada-based businesses (not consumers) that are notable debtors, meaning they have annual revenues of $10,000,000 or more.
  3. Your invoices: Your invoices must also meet certain requirements to qualify for factoring. Services rendered must be complete, and products must have been delivered and accepted by the customer. Invoices must be $500 or greater, with a due date of at least one week away and a payment term of less than 13 weeks.

To qualify for a line of credit, you must be in business for at least six months, have a minimum revenue of $10,000 per month and have a personal credit score of 600 or better. (Lines of credit aren’t available to businesses in Kentucky, Nevada, New Hampshire, North Dakota, South Dakota, Tennessee and Vermont, due to regulations.)

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BlueVine makes it easy to apply for financing; it estimates that it takes approximately five minutes to fill out its online application. After indicating the type of financing you need and the dollar amount of invoices you want to factor, you create an account by entering your basic contact information and setting a password. You’ll then enter business details, such as your business’s legal name, structure, address, annual revenue and Tax ID, followed by personal information, such as your Social Security number.

You’ll then submit financial documents, such as your A/R aging report and the most recent statements from your business bank account. Or, to save time, you can grant BlueVine read-only access to your business’s bank account and connect to your accounting software. BlueVine is compatible with QuickBooks, Xero and FreshBooks.

There are several benefits to connecting your accounting software to your BlueVine account. First, doing so syncs your data, so your invoices appear on your BlueVine dashboard. You can then easily choose which invoices need funding and submit them with one click. Secondly, connecting your accounting software may help you qualify for a higher credit line. Also, if you use QuickBooks, you can skip parts of the application form by clicking on the Connect with QuickBooks button. This automatically prepopulates much of the required information, saving you the time it would take to manually fill it in.

BlueVine takes two to three days to approve your account and begin the verification process. It works with you to verify your customers and notify them to remit invoice payments to BlueVine rather than to you.

After BlueVine receives a response from your customers, it releases funding to you. Although initial funding takes approximately three to five days, subsequent funding can be provided as quickly as the same day you submit the invoice.

To help us get a better idea of how BlueVine compares to other B2B factoring services, we called the company as potential customers and asked how the service works. We learned that BlueVine makes the process very simple, and that funding is fast and flexible – once your application is approved, you can start factoring invoices immediately.

BlueVine’s invoice financing works like most factoring services: The factor advances you a percentage of the invoice amount and then sends the remaining balance, minus fees, once your customer has paid the invoice in full.

There’s no minimum dollar amount of invoices that you’re required to factor each month, and you’re able to pick and choose which invoices you want factored. BlueVine can factor as much as $5,000,000, though the credit limit your company qualifies for depends on the specifics of your business, as outlined in the minimum requirements above.

The company provides funding via money transfers. If you need an advance the same day you submit the invoice, the company sends it via wire transfer, though you have to pay a $15 wire transfer fee. Or, if you can wait, the company sends the funds via ACH transfer for no additional fee, though it may take up to two business days to receive your money.

Like its invoice factoring service, BlueVine lets customers draw on their line of credit immediately after approval. You make weekly repayments on the money you withdraw, and the money is automatically debited from your business bank account. Although your available credit depends on several factors, credit lines range between $5,000 and $100,000. Credit lines are revolving, and there’s no prepayment penalty if you repay withdrawals early.

BlueVine charges low, flat rates between 0.5 and 1 percent per week. The fees are charged against the advance only, not on the full invoice amount. The fee compounds, however, so if your fee is 1 percent per week and it takes your customer three weeks to pay an invoice, you would pay 3 percent of the advance in fees. There are no additional fees, such as application, origination, or early termination fees.

Although we selected BlueVine as the best B2B factoring service, the company has some limitations that may not make it the right factoring service for your business.

The biggest drawback is that BlueVine requires your customers to be notable debtors, with revenues greater than $10,000,000 per year. If the majority of your customers are other small businesses that don’t meet this requirement, you may not qualify to work with this factoring company.

Another consideration is that BlueVine is a recourse factoring service, which means that you’re responsible for any unpaid invoices. You want to make sure that you only factor invoices you know your customers will pay. Otherwise, you’re on the hook for the advance plus fees, which may be problematic if your cashflow is already tight. To learn more about recourse and nonrecourse factoring, visit our Factoring Buyer’s Guide.


American Receivable Review: Best Factoring Service for Small Businesses

American Receivable Review: Best Factoring Service for Small Businesses

American Receivable factoring service

Credit: American Receivable

Our 2017 research and evaluation of factoring services leads us to again recommend American Receivable as the best factoring service for small business. We chose American Receivable from dozens of factoring companies. To understand how we made our decision, and to see our methodology and a list of factoring services, check out our best picks page.

American Receivable has been in the factoring game since 1979, offering its flexible factoring services at competitive rates. There are no monthly minimum requirements, and you’re not required to factor all your invoices; rather, you can choose which ones to send to American Receivable, and it advances funding to you the next business day, giving you fast access to your money. Although it has a one-year contract, you can obtain a release at any time without incurring an early termination fee.

American Receivable’s fees start at 0.8 percent of the total invoice value. There are no application or due diligence fees. The company advances up to 95 percent of invoice values and sends you the reserve, minus its fees, the following Monday after it receives invoice payments from your customers.

American Receivable makes it easy for small businesses of all types and with all credit ratings to qualify for factoring. It considers several data points to determine your rate and advance, such as your industry, business type and the dollar amount of invoices you plan to factor each month. Also, there are no preset minimum requirements that you must meet to set up an account.

New businesses, as well as those with less-than-perfect credit, can work with this factoring service, as the company sets credit limits based on your customers’ creditworthiness, not your business’s revenues or credit history, nor your personal finances or credit score. Although the company requires you to submit financial information about your business and its owners as part of your application, it isn’t the sole consideration as to whether or not your account is approved.

American Receivable doesn’t require you to submit a minimum number or dollar amount of invoices for factoring each month, and factoring maximums are based on the credit limits the company sets on your customers.

There are two ways to submit an application to American Receivable: filling out the form online or downloading, printing and faxing the PDF form.

The application is comprehensive, requesting your business’s legal name and any DBAs (“doing business as” names), your business structure, and your federal ID number. You’ll provide information on all officers, owners and directors of your business, including Social Security and driver’s license numbers. It also asks you to note any changes in ownership or business name in the past 12 months and to describe any issues, such as lawsuits, bankruptcies and back taxes owed.

American Receivable’s application also requests details about your receivables and banking information. This includes the average number and dollar amount of invoices to be factored every month and whether you’re currently working with another factoring service or if you’ve worked with one in the past. You also need to disclose any liens or past-due taxes, as well as any bankruptcies filed by the company or its principals. Signing the application grants the company the right to check both your business and personal credit histories.

In addition to the application form, American Receivable requires the following documentation:

  1. First page of articles of incorporation
  2. DBA, assumed or trade name certificate
  3. Accounts receivables aging report
  4. Accounts payables aging report
  5. Most recent profit-and-loss statement and balance sheet
  6. Current customer list, including contact names, email addresses, phone and fax numbers
  7. Copy of driver’s license
  8. A voided check

The easiest way to submit the application is to fill it out online, since it allows you to upload or email your files electronically. This is faster than faxing or physically mailing copies of these documents, as some factoring services require.

Once you’ve submitted the completed application and all associated documents, American Receivable processes it, typically within 24 hours, and sets up your account in approximately four business days.