Factoring cost calculator — know the real cost of your term sheet

Model any export factoring term sheet: advance, interest, processing, platform, factoring and any other charges. See your day-1 cash, settlement amount, total cost and effective annual cost (APR) — recalculated instantly as you edit.

Transaction

Financing pricing

Fees

per annum
per invoice

Overall metrics

Effective annual cost10.39%APR over 90 days, on net cash received
Total dollar cost$2,171.32Every charge, excluding the reserve
Cost % of invoice2.17%$100,000.00 invoice
Cost % of advance2.55%Compare across advance %

Transaction summary

Invoice amount$100,000.00
Advance (85%)$85,000.00
Balance held$15,000.00
Effective financing rate6.62%
Cash received after factoring (day 1)$84,716.16

Cash flow

Gross advance$85,000.00
Processing fee (upfront)−$83.84
Platform fee (upfront)−$200.00
Upfront deductions−$283.84
Net cash received (day 1)$84,716.16
Balance held$15,000.00
Financing interest−$1,387.48
Factoring fee−$500.00
Cash received after buyer pays
(balance − fees)$13,112.52

Cost breakdown

Financing interest (on advance, actual/365)$1,387.48
Processing fee$83.84
Platform fee$200.00
Factoring fee$500.00
Total cost$2,171.32

Balance of $15,000.00 is money held back until settlement, not a fee — it comes back to you as the balance released, minus charges at settlement (interest, factoring fee and settlement charges totalling $1,887.48).

Most exporters cut their APR by 2–4% through our global lender network spanning the US, UK, EU, Middle East and Asia.

The real cost of factoring is rarely the headline rate. Interest is one line among many: processing fees, platform fees, factoring fees, insurance, wire charges and documentation charges all land on different bases and at different moments of the deal.

See through the headline rate

SOFR + 3% sounds cheap until fees land on the wrong base. The calculator folds every fee into one total and one APR.

Model any term sheet

Fixed or percentage fees, charged on invoice, advance, facility or reserve, upfront or at settlement — every structure is covered.

Compare like with like

Cost % of advance and effective annual cost (APR) let you stack a factoring offer against bank finance or another factor.

How the factoring cost calculator works

The calculator models your deal in three layers. The transaction layer captures what you are financing — invoice amount, currency, credit period and advance %. The pricing layer captures how the factor charges — a benchmark rate (90-day SOFR for USD, Euribor for EUR, SONIA for GBP, DR001 for CNY) plus an all-in spread that bundles risk, insurance and other invoice-linked costs, plus every fee in the term sheet. The calculation layer puts the two together.

What the outputs mean

Net cash received (day 1) is the advance minus every upfront charge — what actually hits your account. Settlement amount is the reserve released when your buyer pays, minus interest, the factoring fee and any settlement charges. Total cost is every charge combined; the reserve is excluded because it is your own money coming back. Effective annual cost (APR) annualises the total cost on the net amount you actually received, so a 90-day deal can be compared with a 180-day deal or a working-capital line.

Common traps the calculator exposes

  • Interest charged on the invoice value while you only receive 80-90% as an advance.
  • Percentage fees quoted on the facility or reserve instead of the advance.
  • Upfront fees deducted from the advance — they raise your true APR far more than they appear to.
  • Per-invoice fixed charges that look tiny on a single shipment but compound across a season.

From model to money

Once your term sheet is priced, get financing against it. Trad arranges export factoring, LC discounting and bill discounting for Indian exporters — see which markets we cover with the buyer financing checker, check eligibility for the 2.75% MSME interest subvention on the HS code subvention checker, or read how the products compare in factoring vs LC discounting vs forfaiting vs bill discounting.