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What is a Factoring Broker?
Factoring Broker
What is an Indepndent
 Freelance Factoring Broker?

Order Factoring 101: A Broker's Guide

What is a Factoring Broker?

Factoring Brokers (or as they are commonly termed...commercial finance consultants), are highly regarded consulting professionals operating on a freelance basis as "middlemen" in the factoring and asset-based finance industry.  Successful industry brokers tend to be very skilled and highly knowledgeable individuals acting as independent business development professionals for factors, asset-based lenders, and others. It is the job of the factoring broker to assist small business owners in securing the necessary financing required to operate their businesses profitably and successfully.

Always Independent in Nature

Factoring brokers always operate as independent contractors. While most factoring firms have one or more in-house Business Development Officers or BDOs who work to attract new clients to the firm, factoring brokers do much of the same thing but simply as freelancers, often working closely with not just one butIndependent Freelance Factoring Brokers perhaps a dozen or more factors and lenders at the same time.  This is because of the many unique niche and specialty areas in the factoring industry and it is the job of a professional broker to be able to competently match a client with the right factor or lender that will provide the best and most affordable service.

Paid on a Commission Basis

Just as in-house business development personnel are compensated for attracting new clients to the factoring firm, so are independent factoring brokers.  But while most BDOs are paid a salary plus incentive commission, freelance brokers are compensated on a commission basis only.  As with their in-house BDO brethren, the commission earned by freelance brokers is not a "one time shot" fee.  It is a residual compensation based upon the monthly factoring volumes of referred clients and is paid for the life of the account. Such an attractive fee arrangement insures that independent brokers:

Paid by the Factor

Since brokers are compensated by the factor for business referrals, there is seldom a need to seek fees from their factoring clients.  Such "double dipping" is typically frowned upon by industry professionals.  It is also important to note that the referral fees paid to a freelance broker do not affect the fee rates paid by the client for the factor's services.

Much Sought After Industry Partners

Productive freelance brokers are much sought after business partners throughout the factoring industry and in fact, a visit paid to almost any factor's website will evidence his fact.  Somewhere on the website you will find a "click here" tab titled "brokers", "partners", "referral" or something similar and clicking the link with display the factor's / lender's program for independent agents.  Since roughly 50% of all new client accounts generated in the industry are sourced by referral, it is no wonder factors are constantly seeking to build their network of well-trained and productive freelancers.

The Ultimate Business Opportunity for Self Starters

With its residual life of account commission income and complete freedom to work where and as much or little as you want, brokering factoring transactions may well be the ultimate business opportunity for motivated self-starters and mobile creatives.  Although well-practiced in Europe, this unique professional vocation  is still well under-the-radar in the U.S. so competition is light in most areas.

Find Out More

Want to further explore the business opportunities found as a freelance consultant in the factoring industry?  It's easy to do so with the help of IACFB.  Although broker training in the industry has been historically expensive ($15,000 and up) and difficult to obtain, that has all changed with the help of the IACFB and its highly regarded (and very affordable), five star training program...Factoring 101.  And the place to start is with the IACFB's official introductory training guide, "Factoring 101:  A Broker's Guide" available for purchase directly from Amazon.com.  Click the image in the left column above to find out more.