Invoice Factoring vs. Line of Credit Calculator

How this is calculated

Factoring fee = invoice amount × the factoring rate × (days ÷ 365) -- the standing 8.75% assumption is the same annualized rate BizyFi's own intake flow uses for invoice factoring, prorated for the actual number of days the invoice is outstanding rather than a full year. You receive the advance rate's share of the invoice now, and the remainder (minus the fee) once your customer pays.

Line of credit interest = the invoice amount you draw × the LOC rate × (days ÷ 365), using the same proration. Unlike factoring, a line of credit isn't tied to one invoice's advance rate -- if your available credit covers it, you can typically draw the full invoice amount now, not just 80-90% of it.

The cheaper option in raw dollars isn't always the more useful one: factoring is often accessible to newer or thinner-balance-sheet businesses that wouldn't yet qualify for a line of credit at all, since underwriting focuses on your customer's creditworthiness rather than yours. See our full factoring vs. line of credit guide for the qualitative tradeoffs behind these numbers.

The calculation itself runs entirely in your browser -- the specific figures you enter are never transmitted or stored, except that the "Get your full pre-qualification estimate" button below carries the amount you entered into the application form's URL so you don't have to type it twice. Separately, we log anonymous usage analytics (that this page was viewed, or that a button was clicked) to see which calculators are useful -- never the numbers you type.