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1 . What Is Alternative Finance? →
2. Where Traditional Financing Falls Short →
3. Best Alternative Business Loans →
4. Financing Alternatives Comparison Chart→
5. Alternative Capital Funding Solutions →
6. Understanding Invoice Financing as a Financial Alternative →
7. The Benefits of Invoice Factoring →
8. Selecting the Right Alternative Business Lending Partner→
Whether you’re starting a new venture or trying to cover operational expenses, having access to working capital is essential. A lack of adequate cash flow is one of the top reasons businesses fail. When experiencing cash flow challenges like extended payment terms or seasonal fluctuations, many companies rely on traditional bank financing, which can be tricky to secure and often leads to more debt.
Alternative finance or non-traditional financing options like invoice factoring provide businesses with the best of both worlds—immediate and consistent cash flow without the baggage of traditional financing.
At REV, we provide reliable invoice factoring services to companies in numerous industries, helping them overcome financial constraints. We tailor our alternative business financing solutions to your needs and business goals, ensuring you receive fast funding for scalable, sustainable growth.
Alternative finance is any source or method of obtaining funds outside traditional banking institutions and markets. This includes a broad spectrum of options, including merchant cash advances, micro-lending, and invoice factoring, the latter of which is most suitable for creating immediate debt-free liquidity.
These alternative funding models offer faster, more flexible capital funding, making them some of the best alternative business loans for small and mid-size businesses. The best part? They don’t come with the strings and fine print of traditional lenders.
Fuel Business Growth with Invoice Factoring
-No Debt: You’re not taking on loans—just unlocking money you’ve already earned.
-Faster Cash Access: Get funded in as little as 24 hours, not weeks.
-Flexible Fund Use: Spend it your way.
-Fast, Easy Approvals: No complex applications or rigid credit requirements.
Alternative finance supports businesses of all sizes, from bridging cash flow gaps to funding growth opportunities. Leaders need to stay competitive in their market, and alternative funding models support these evolving needs.
For example, a manufacturing company that needs to expand its warehouses can sell their unpaid customer invoices to an invoice factoring company to fund these costs (more on this below), rather than seeking a business loan with potentially high interest rates and a fixed amount of funding.
Related resource → How Invoice Factoring for Manufacturing Works
Business loans have been a staple financing tool for over a century. However, they’re far from perfect. Although a loan can give new or struggling businesses access to significant funding, securing capital through these means is often challenging, not to mention burdensome after the loan takes effect.
These reasons are precisely why alternative financing has risen in popularity and usage over the years.
Many alternative financing options are available to business owners today, some more popular than others. Here’s a look at some of these top alternatives.
Invoice factoring converts your unpaid invoices into immediate cash. Instead of waiting for customers to pay, businesses can access fast working capital from alternative funding sources like REV. This alternative business lending solution helps manage cash flow and grow your operations. How does it work? The company takes a small fee for their services, but the majority of the invoice value is yours. Through this alternative, your unpaid invoices become an asset.
→ Related resource: Is Invoice Factoring Right for Your Business?
A merchant cash advance provides fast working capital by advancing funds based on your future credit card sales. This alternative business financing option offers flexible repayment terms linked to daily sales, making it ideal for businesses with fluctuating revenue. How does it work? Instead of fixed monthly payments, repayment happens through a percentage of future credit or debit card sales. This continues until the advance (plus fees) is fully repaid.
A business line of credit is a revolving credit facility that lets you borrow up to a set amount and pay interest only on the amount you use, not the entire sum of what you borrowed. Similar to a credit card, you can access funds as needed. Many small business owners turn to this option to cover short-term operational needs.
Some businesses may opt for a term loan, a one-time lump sum with a fixed repayment schedule, usually lasting 1-10 years. You repay the principal and interest in regular installments, but the terms are based on your creditworthiness and loan purpose. These business loans are great for funding major investments, but qualifying can be tough for newer businesses or those with poor credit.
→ Related resource: The Pros and Cons of Loans
When you need to purchase high-value tools and supplies, loans that assist with equipment financing can be useful. This financing alternative allows you to secure funding to purchase or lease business equipment. The equipment serves as collateral, reducing lender risk. More importantly, you can repay the loan in fixed installments throughout the life of the equipment.
With revenue-based financing, you receive capital in exchange for a percentage of future sales until you reach a pre-established repayment cap. Payments may fluctuate based on business performance, aligning your payment installments with your cash flow. It could be a smart alternative business finance option for those with consistent but variable income.
A micro-lending arrangement often targets small business owners who lack access to traditional bank loans. Essentially, microloans are unsecured and provided through alternative lenders like group lending or individual programs. Institutions offering microfinancing may also provide financial literacy and consulting along with these small business loans.
Type of Funding: Cash flow-based, using receivables
Speed of Access: Fast – typically 24 to 48 hours
Repayment Structure: Not considered a loan. A factoring company collects payments directly from the business’s customers.
Credit Requirements: Low – focus is on the customer’s creditworthiness rather than the business's.
Risk Level: Low
Best For: Businesses with outstanding invoices, such as those in manufacturing, transportation, or staffing.
Key Considerations: No new debt is incurred; useful for short-term cash flow improvement.
Type of Funding: Cash flow-based, derived from revenue
Speed of Access: Very fast – 1 to 3 days
Repayment Structure: A fixed percentage of daily sales is deducted until the total advance is paid back.
Credit Requirements: Medium
Risk Level: High
Best For: Retail and service-based industries
Key Considerations: High overall cost; repayments fluctuate with sales volume, potentially straining daily cash flow.
Type of Funding: Debt-based
Speed of Access: Moderate
Repayment Structure: Flexible drawdowns with adjustable repayment options
Credit Requirements: Medium to high
Risk Level: Low to medium
Best For: Businesses managing ongoing working capital needs
Key Considerations: Interest is charged only on the amount used; a great solution for bridging cash flow gaps.
Type of Funding: Debt-based
Speed of Access: Slow – can take weeks to months for approval
Repayment Structure: Fixed monthly payments over a set term
Credit Requirements: High
Risk Level: Medium to high
Best For: Long-term investments or large asset purchases
Key Considerations: Comes with a strict approval process; increases debt load on the balance sheet.
Type of Funding: Asset-based
Speed of Access: Moderate – generally 3 to 7 days
Repayment Structure: Fixed payments, secured by the equipment being purchased
Credit Requirements: Medium
Risk Level: Medium
Best For: Companies acquiring machinery or vehicles
Key Considerations: Equipment acts as collateral, which limits flexibility if business conditions change.
Type of Funding: Cash flow-based
Speed of Access: Moderate – usually 3 to 5 days
Repayment Structure: A percentage of monthly revenue until the repayment target is met
Credit Requirements: Medium
Risk Level: Medium
Best For: Businesses in a growth stage
Key Considerations: Offers flexible repayment aligned with performance, but can become costly over the long term.
Type of Funding: Debt-based (small loans)
Speed of Access: Ranges from fast to moderate
Repayment Structure: Fixed, small repayment amounts
Credit Requirements: Low
Risk Level: Low to medium
Best For: Startups, small businesses, and ventures in underserved markets
Key Considerations: Good for very small capital needs; limited scalability and smaller funding amounts.
While financing alternatives are options different from traditional loans, capital funding alternatives are innovative ways to secure investments.
Factor your invoices with REV, North America’s trusted invoice factoring company. We’ll turn your receivables into fast, flexible cash so you can fuel growth and leave collections behind.
As mentioned, invoice factoring turns your unpaid invoices into immediate working capital by selling them to a factoring company. Since you're not borrowing money, there's no debt to repay—you're simply accessing funds you've already earned.
Let's explore the process of invoice factoring with REV, and why it’s one of the best alternative financing options available.
The process begins with submitting your application to the invoice factoring company (e.g., REV) to analyze your customers' creditworthiness. Once approved, we’ll send you our agreement outlining payment terms, factoring costs, and other requirements or conditions.
The next step requires little from you. Simply conduct business as you usually would, but submit your invoices to us so we can verify them.
Once we’ve verified your invoices, we’ll advance the majority of your total invoice value. We hold a small reserve, which we release (minus our small fee) once your customer pays the invoice in full.
At REV, we tailor our fee structures to each client’s unique needs. Curious what that could look like for your business? Contact us to learn more.
Continue business operations without worrying about accounts receivable. We’ll handle customer payments directly, collecting the full invoice amounts on your behalf.
Not all companies providing alternative banking solutions offer invoice factoring tailored to an individual business. That’s what makes REV different. We offer invoice factoring that goes beyond just providing you with reliable funding.
At REV, we deliver invoice factoring that is fully transparent and honest. We explain every step of the process and benefits to your business, ensuring you get all that’s discussed—no fine print, no hidden costs, and no surprises.
We don’t offer template solutions. Every company seeking alternative funding sources, like invoice factoring, has their own needs. At REV, we offer factoring that fits your business strategy and stage of development.
Get dedicated support whenever you need with our accessible account team, helping streamline your accounts receivable and more. When you sign up with REV, you get more than just an online portal.
You might ask, “Is invoice factoring right for my business?” The only way to know is to consult a factoring company that can help you determine whether you’re a good candidate for this type of alternative funding. Here at REV, we cater to businesses that comply with the following criteria:
Factoring companies typically accept online applications. The process is usually straightforward, requiring you to submit:
Once approved, the factoring company will establish a factoring agreement with your business to manage transactions and funding.
REV is the leading provider of invoice factoring for small, medium, and enterprise-level businesses in North America. We understand the unique challenges growing businesses face, and we’re here to help provide the alternative finance solutions you need to succeed.
When you partner with an expert in invoice factoring, like REV, you gain access to a financial strategy that’s proven essential for thriving in an unpredictable economy.
We’re committed to helping you grow by transforming your invoices into fast, flexible funding. Let’s work together to fuel your next chapter.
Don’t let cash shortfalls and inconsistencies stall your business growth any longer. Invoice factoring is the best alternative finance option for businesses looking to tap into a steady cash flow. Contact the REV team to learn how factoring can help you generate debt-free funds immediately.
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