Factoring Structures – Spot & Transactional Factoring

Some factoring companies are open to what’s called a “spot” transaction – essentially a one-time deal where a business sells invoices just once, with no ongoing relationship expected. It’s a quick, short-term solution for companies that need cash fast or want to jump on a business opportunity.

The process works just like regular factoring, but everyone knows it’s a one-and-done arrangement. For a factor to consider a spot deal, a few things typically need to line up:

• The invoices should total at least $100,000
• The customers (debtors) must be financially strong and reliable
• Verification will be strict, often requiring written confirmation

Because these deals are transactional and don’t build a long-term relationship, the discount fee is usually higher – often in the 5–10% range – to offset the added risk and effort involved.