Freight factoring fee calculator
See what a factored invoice really pays: advance, reserve, factoring fee, transfer fees and the effective cost, per invoice and per month.
How to use it
- Enter a typical invoice and how many you factor per month.
- Enter the fee percentage, advance rate and any flat fees from the factor’s written quote.
- Compare offers by the effective cost and yearly cost, not just the headline percentage.
The formula
Up front = invoice × advance rate − flat fees. Reserve = invoice × (1 − advance rate) − percentage fee. Effective cost = (percentage fee + flat fees + monthly fees ÷ invoices) ÷ invoice. Some factors take the fee from the advance instead of the reserve. The total is the same, only the timing differs.
Comparing companies? See all factoring companies and factoring for new authorities.
Frequently asked questions
How is the factoring fee calculated?
Most factors charge a percentage of the invoice face value. On a $2,500 invoice at 3%, the fee is $75. Some also charge per-transfer fees (for example for wires or same-day payments) or monthly minimums, so ask for the full fee schedule in writing.
What is an advance rate and a reserve?
The advance rate is the share of the invoice the factor pays you up front. The rest, the reserve, is held until the broker pays, then released to you minus the fee. Some companies advance the full amount with no reserve. Our how factoring works guide explains it.
What does “effective cost” mean here?
All the money the factor keeps (percentage fee plus flat fees) as a share of the invoice. Two offers with the same percentage can cost different amounts once transfer fees are added.
Is the fee different for recourse and non-recourse factoring?
Often, yes. Non-recourse covers you if a broker cannot pay because of insolvency, and that protection is usually priced in. See recourse vs non-recourse factoring.
This calculator runs in your browser and nothing you type is sent anywhere. Results are estimates for planning, not tax, legal or financial advice.