Editor’s note: NerdWallet’s Step by Step series gives small-business owners a behind-the-scenes look at the loan application process for various online lenders. We show you what you can expect screen by screen as you submit your application.
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Fundbox invoice financing application summary
Fundbox is an invoice financing company that gives small-business owners cash for their unpaid invoices. The company doesn’t purchase your unpaid invoices, and it doesn’t contact your customers. Instead, in a variation on invoice factoring, you can borrow up to 100% of the value of each unpaid invoice. Borrowings are repaid in 12 equal weekly installments.
The speed, convenience and repayment flexibility of Fundbox make it a good option for small businesses that have unpaid invoices and need working capital or funds to smooth out cash flow. Plus, the application-to-funding process is quick and simple. Read our Fundbox review.
Fundbox invoice financing application: Summary
- Time: A Fundbox account can be created in a minute, with funding as fast as 24 hours.
- Documents needed: None
After creating a Fundbox account, you connect one of the accounting apps the company is compatible with and add your unpaid invoices to Fundbox. The company will automatically pull up your unpaid invoices as soon as they are added to the app.
From there, you pick an unpaid invoice to clear and provide a bank account where Fundbox will send the funds. Repayments are automatic through this account. But you also can repay in full at any time without penalty, and the company will waive any remaining fees.
The financing does come at a cost. Fundbox’s advances have an annual percentage rate of 44% to 64% (APR is the true cost of borrowing, including all fees). Fees decrease, however, the more you use Fundbox, and borrowers can repay the advance early without penalty to save on fees, which lowers the APR on the advance.
| Fundbox at a glance | |
|---|---|
| Type of funding | Invoice financing |
| Cost of funding | 44% to 64% APR |
| Financing amount | $500 to $30,000, depending on the value of your invoices |
| Financing term | Equal weekly repayments over a 12-week period |
| Minimum qualifications | Must have unpaid invoices and use online accounting software that can link to Fundbox (QuickBooks, FreshBooks, Harvest, Xero, Wave, Clio, InvoiceASAP and Sage One) |
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Fundbox invoice financing application: Step by step
1. CREATING A FREE ACCOUNT
Once you arrive at Fundbox’s secure website, create a free account.
You need to provide a few details: your business email address (which will serve as your Fundbox user name), business phone number and a password for your Fundbox account. There’s no credit check or any additional application requirement at this time.
“We just don’t look at credit score,” says Fundbox’s Jordan MacAvoy, vice president of marketing. A credit check is “a good indicator for underwriting a person,” he says, but “we don’t think it’s a great indicator for underwriting a business.”
Applicants can call Fundbox at (855) 572-7707 (you’ll see that number in the upper right-hand corner of the screen) at any point during the application process to speak with one of the company’s small-business consultants.
2. CONNECTING YOUR INVOICES
Once you’ve created an account, it’s time to add your invoices so you can start clearing them, which means getting them approved and funded.
You’ll connect your accounting or bookkeeping software to Fundbox. The company works with Intuit QuickBooks, FreshBooks, Xero, Harvest, Wave, Clio, InvoiceASAP and Sage One. To get started, click the “add your invoices” button.
A screen will then pop up that asks which app Fundbox should pull the invoices from. Select the appropriate accounting app.
3. EVALUATION PERIOD
After selecting an accounting app, you will be prompted to sign into that account. At this point, you are authorizing Fundbox to access your data. There is no credit check, however, and no obligation for the customer to use Fundbox; this is still the onboarding process, MacAvoy says.
After you sign in and authorize the account, Fundbox says it will take up to three hours for the company to evaluate your business and your individual invoices. Fundbox says it underwrites each application based on the “indicators” it gets through the accounting software. The company says its technology also pulls information from a variety of sources (Fundbox declined to provide NerdWallet with specific examples). MacAvoy says Fundbox bases its decision on the health of the business.
“Many businesses,” he says, “especially those that are growing, experience cash-flow gaps from time to time.”
4. CLEARING INVOICES
After receiving the email approval notification, you can log back in to the Fundbox dashboard, which shows you all of the outstanding invoices you have available to clear through Fundbox, as well as the total amount of capital Fundbox is giving you. That amount is based on the value of your invoices.
When you issue new invoices from your accounting software, the invoices will pop up in your Fundbox dashboard. Each invoice is automatically evaluated by Fundbox and, if approved, will show up in your dashboard as available to clear, according to the company.
If this is the first time you’ve used Fundbox to clear invoices, the company will ask you where it should deposit the money — a business or a personal checking account. Enter the name on your account, as well as your bank account and routing numbers.
Once that’s done, you can clear the invoice, and Fundbox tells you exactly how much money you’ll get and what you’ll repay over the 12-week period. It’ll also give you the amount of each weekly payment and the due dates for the first and last payments.
The company charges fees over a 12-week period, with an equal amount of fees paid each week. In the above example, the borrower receives $14,619.85 for one invoice. The total repayment amount, however, is $15,471.94, which includes a fee of $852.09. Over a 12-week period, the borrower will pay about $1,289.32 each week. Borrowers can repay early, however, and have all of the remaining fees waived.
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To apply at Fundbox
If Fundbox sounds like the right fit, apply on Fundbox’s secure site:
Learn MoreFind and compare small-business loans
To compare lenders, NerdWallet has created a comparison tool of the best small-business loans to meet your needs and goals. We gauged lender trustworthiness, market scope and user experience, among other factors, and arranged the lenders by categories that include your revenue and how long you’ve been in business.
Steve Nicastro is a staff writer at NerdWallet, a personal finance website. Email: Steven.N@nerdwallet.com. Twitter: @StevenNicastro.
To get more information about funding options and compare them for your small business, visit NerdWallet’s tool for small-business loans. For free, personalized answers to questions about financing your business, visit the Small Business section of NerdWallet’s Ask an Advisor page.
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