Top 5 Tips to Consider when Choosing a Freight Factoring Company

By 12.13.13September 18th, 2022No Comments
Red transport truck driving down the highway

Do you know how factoring your invoices can help your business with cash flow? Simply put, factoring is a process where a company purchases your invoices then pays you a percentage of that invoice quickly. Factoring allows you to use the advanced funds to meet your fuel demands or other overhead business expenses.

What should you look for when choosing a factoring company?

When deciding on who is the best factoring company for owner operators, it’s important to remember — not all factoring companies are alike! Choose a reputable and ethical company that understands your business and accommodates your specific needs.

To help you narrow your search, we’ve pulled together the top 5 tips to consider when choosing a factoring company:

1. Flexibility – Can you factor only the invoices you choose?

Some factoring companies require a minimum number of invoices or a minimum volume each month. Be sure to ask about this upfront because there may be instances where you only want to factor your slow paying customers. It’s best to choose a factoring company that allows flexibility so you can pick and choose the invoices you want to factor.

2. Industry Knowledge – Does your factoring company understand the trucking business?

It’s important to choose a freight factoring company that understands the demands you face in the trucking industry. Does a local or national Trucking Association endorse your factoring company? Your factoring company should know the ins and outs of your business and offer flexible solutions and discount programs tailored to your trucking company.

3. Fuel Cards – Is the top factoring company on your list offering a FREE fuel card?

Fuel is the most significant expense in trucking and your factoring company should provide you with a FREE fuel card. Choose a factoring company that has a fuel card so you can save every time you fill up.

4. Customer Service – Is your factoring representative going to be available when you need them?

It’s imperative to choose a factoring company that provides 24-hour online account access so you can see exactly where your funds are in the factoring process. If a factoring company can’t provide online access to your account, they may be lacking critical tools to support your business. Ask the company upfront how you can access your account, and ask for their hours of operation. Are they open evenings and on Saturdays? You don’t work 9-5, and neither should your factoring company.

5. Recourse vs. Non Recourse – Does the factoring company offer a Non-Recourse Agreement?

There are two major types of accounts receivable factoring- recourse and non-recourse. Factoring with recourse means the client must buy back an invoice from the factoring company if the invoice is not paid within a certain number of days. Alternatively, non-recourse factoring means the factoring company assumes the risk for non-payment of an invoice. Does the factoring company offer non-recourse agreements for certain invoices? You may want that extra protection and peace-of-mind that a non-recourse agreement can offer, so it’s important to choose a factoring service that will work with your individual needs.

We hope you’ve enjoyed these factoring tips and feel more confident about picking a freight factoring company! Check back on our blog for more tips and tricks to help you grow your business with factoring.

eCapital Logo

eCapital Corp. is committed to supporting small and middle-market companies in the United States, Canada, and the UK by accelerating their access to capital through financial solutions like invoice factoring, factoring lines of credit, asset-based lending and equipment financing. Headquartered in Miami, Florida, eCapital is an innovative leader in providing flexible, customized cash flow to businesses. For more information about eCapital, visit

More Great Reads

Don't Let Your Trucking Company Get Trapped by Double BrokeringBlog

Don’t Let Your Trucking Company Get Trapped by Double Brokering

The act of double brokering is the unauthorized transfer of a load to another trucking company. Due to market volatility, the industry is seeing an uptick in this illegal practice.…
5 Ways Freight Factoring Can Improve Your Trucking Company's Credit ScoreBlog

5 Ways Freight Factoring Can Improve Your Trucking Company’s Credit Score

Like any business, owner-operators, fleets, and freight brokers need working capital to keep their trucking company running. Funds are required daily for fuel, food, truck maintenance, fleet growth, and for…
How to Grow Your Trucking Company and Thrive in a Volatile Market?Blog

How to Grow Your Trucking Company and Thrive in a Volatile Market

It's been a bumpy ride for the trucking industry! Profit rates have been up and down like a roller coaster in the past five years. First rising through 2017 and…