How Oil & Gas Invoice Factoring Works
Plain English, no jargon. From application to cash in your account — here is exactly what happens when an oilfield contractor factors their invoices.
Plain English, no jargon. From application to cash in your account — here is exactly what happens when an oilfield contractor factors their invoices.
When you factor an invoice you are selling an asset you already own — money already owed to you — at a small discount to get it today instead of 90 days from now. No monthly payments. No interest. No debt on your balance sheet.
✗ Traditional Bank Loan
✓ Invoice Factoring
Fill out a simple application with your company info, monthly invoice volume, and who your primary customers are. No tax returns. No business plan. No collateral. No credit score requirement.
What actually matters: who you invoice. If your customers are credible oil and gas operators, you have a strong chance of approval regardless of how long you have been in business.
Your application is reviewed against your customer base. This is a credit review of your operators — not you. Major energy companies like Chevron, Shell, Pioneer, and ConocoPhillips make approval straightforward.
Most applications receive a decision the same business day. Once approved, you sign a factoring agreement and start submitting invoices immediately.
Upload completed, customer-accepted invoices through the secure portal. The invoice must be for work that has already been done and accepted. Submit daily as you complete jobs — no batch schedule.
Up to 90% of the invoice value is wired or ACH’d to your account. When your operator pays, you receive the remaining reserve balance minus the factoring fee.
Example — $100,000 Invoice
| Advance paid today (90%) | $90,000 |
| Reserve held (10%) | $10,000 |
| Factoring fee (example 2.5%) | − $2,500 |
| Reserve returned when operator pays | $7,500 |
| Total you receive | $97,500 |
Rates vary by customer creditworthiness and monthly volume.
The scenario below is a hypothetical, illustrative example used to walk through the timeline and numbers — it does not represent an actual client, invoice, or transaction.
Hypothetical Scenario — Hot Shot Trucking Company
A hot shot trucking company completes a load delivery for a mid-size operator in the Permian Basin. The job is accepted and invoiced at $18,400 on the operator’s standard Net-60 terms.
Instead of waiting 60 days, the company applies for factoring. Because the operator is a recognized energy company, approval is based on the operator’s credit — not the trucking company’s time in business.
The completed, accepted invoice is submitted through the portal. Approval and submission both land within the same business day.
Within 24 hours of submission, 90% of the invoice — $16,560 — is wired to the company’s account. Payroll and fuel get paid on time without touching a bank line of credit.
The operator pays the invoice on its normal terms. The remaining reserve, minus the factoring fee, is released back to the company.
Illustrative Numbers — $18,400 Invoice
| Advance paid Wednesday (90%) | $16,560 |
| Reserve held (10%) | $1,840 |
| Factoring fee (example 3%) | − $552 |
| Reserve returned when operator pays | $1,288 |
| Total received | $17,848 |
Hypothetical example for illustration only. Actual rates, advance percentages, and turnaround depend on your specific operator and invoice volume.
Free application. Same-day approval. Cash in your account within 24 hours.