What Is Freight Invoice Factoring?
Factoring is a financial transaction and a type of debtor finance in which a business (motor carrier) sells its accounts receivable to a third party (factor) at a discount. A business will sometimes factor its receivable assets to meet its present and immediate cash needs.
How Does Factoring Work?
- Check Credit
Don’t forget to verify your customer’s credit with us before you move any freight. This will minimize risk and exposure. Free credit checks are included.
- Deliver Load
Your customers will likely be a broker or a shipper.
- Send Paperwork
Upload or email your freight bills to us. We will prepare the invoice for you. Freight bills should include all of the pertinent load attachments, i.e. signed BOLs, rate confirmations, scale tickets, lumper receipts, etc.
- Get Paid
Once we receive your shipping documents, we will fund you the SAME DAY. Unapproved customers, incorrect load attachments, shipment shortages and/or damages, and rate changes could slow down the funding process.
- Invoices are sent to your customer
After we fund you, we will then send invoices to your customers. All invoices are mailed or submitted to your customer the day we fund you. Our collections efforts begin soon after we submit your invoices. You will have online access to the status of all your open invoices.
- Your customer sends payment to us
The process is complete once we receive invoice payment from your customer. We’ve found the typical turnaround time for invoice payment is 30-45 days. Any short paid or unpaid invoices may be offset against your future invoice submissions.
*Trucking Partners offers both Recourse and Non-Recourse Factoring Programs. However, the majority of our carrier clients choose our flat rated, non-recourse freight factoring program for its simplicity and bad debt protection.