For many companies, factoring is a proven tool for quickly accessing working capital. But how long does it take to implement a factoring program and start receiving the first funds? The answer depends on several factors—and not all factoring providers are equally fast.

Implementation Time: What Factors Affect the Speed?

The time it takes to receive the first payment through factoring varies greatly. The following factors are particularly important:

  1. Review of Accounts Receivable

Before a factoring provider purchases receivables, it assesses the creditworthiness and payment history of your customers. Among other things, it analyzes:

  • Payment Terms: How long do you allow your customers to pay?Image accompanying the Creditreform Payment Indicator: Longer payment terms coincide with record-high insolvencies: A cluttered workspace with many tasks to complete
  • Contractual Agreements: Are there any individual arrangements that affect the risk of default?
  • Counterclaims: Are there any outstanding disputes or claims for reimbursement on the part of the debtors?
  • Incoterms: Which delivery terms (e.g., FOB, CIF) apply to your transactions?

The more complex the accounts receivable structure, the longer this step may take.

  1. Audit Requirements of the Factor

Some factoring providers—particularly those affiliated with banks—require an audit before they approve a program. This can be conducted remotely (via data transmission) or on-site. Such an audit typically extends the implementation period by several weeks.

  1. IT Interface and Technical Integration

To ensure that invoices are automatically transmitted to the factor and that pre-financing proceeds smoothly, an IT interface must be set up. Depending on the complexity of your accounting systems (e.g., SAP, Datev), this can take anywhere from a few days to several weeks.

Standard vs. Accelerated Implementation

Bank-affiliated factoring providers: At least 3 months

Factoring companies that work closely with banks often have strict compliance requirements. In such cases, an implementation period of at least 3 months is realistic—from the initial inquiry to the first payment.

Mid-sized, bank-independent factoring companies: Reaching the goal faster

Independent factoring providers that specialize in small and medium-sized businesses often rely on streamlined processes. With straightforward accounts receivable and a well-prepared IT infrastructure, implementation can be completed within 4–6 weeks.

Important Note When Changing Factors: Be Sure to Observe the Notice Periods!

If you already have a factoring agreement and would like to switch providers, be sure to check the notice periods. For many providers, these are 6 months—a long wait that could delay your plans.

Immediate Liquidity: 24-Hour Pre-Financing Available

Once the factoring program is implemented and running smoothly, you can take advantage of how quickly it works:

  • 90% of the invoice amount will be paid to you within 24 hours of the factor’s receipt of the invoice.
  • The remaining amount (minus fees) will be paid as soon as your customer has settled the invoice.

This makes factoring particularly attractive for growth-oriented companies that need short-term liquidity for investments, personnel, or materials.

Do you have questions about factoring?

We would be happy to provide you with personalized advice on how factoring can help you secure your cash flow quickly and easily.

Contact us for a no-obligation consultation!