How Same-Day Funding Works and What It Costs

Every same-day funding offer comes down to a few figures: what you receive, what you sell, what’s deducted and what your state requires the funder to disclose. This guide uses no example figures, because the only numbers that matter are the ones in your own offer.

Purchase Price and Purchased Amount#

Same-day business funding is typically structured by the funder as a purchase of a portion of your business’s future receivables. It is not a loan. Velo is a broker, not the funder: we shop your file across a wide range of funders and help you compare their offers.

• Purchase Price: what the funder pays your business up front.
• Purchased Amount: the total receivables you sell in exchange, delivered through remittances as your business collects.
• Cost: the difference between the two, plus any fees in your agreement. It’s fixed when you sign, and there’s no interest.

If your sales slow down, ask how reconciliation works.

Fees and Net Funding#

Fees are often deducted from the Purchase Price, so the figure you hear first and the deposit can differ. Net funding is what actually lands in your account, so always ask for that number. Every fee should be listed in your agreement and disclosure before you sign.

Timing#

After approval and signing, funds can arrive as soon as same day. Funding is always subject to approval, timing varies with your documents and your bank, and no funder can guarantee a funding date.

The State Disclosure#

A growing number of states require a standardized written disclosure before you sign. It typically shows the funding amount, what you’ll actually receive, the total cost, how remittances are collected and any fees. In some states, including California and New York, it includes an estimated APR for comparison. Read it before you sign: the disclosure and the agreement are what count.

Comparing Offers#

• Compare dollars to dollars: net funding, total cost and the Purchased Amount.
• Use the estimated APR where you have one to compare same-day funding with a loan, remembering it depends on assumptions about your sales.
• Weigh the alternatives. Same-day business funding usually costs more than bank or SBA loans. If your business qualifies for a lower-cost option and the need can wait, that option may be the better choice. See choosing the right funding.

Red Flags#

• Upfront or advance fees to “unlock,” “secure” or “process” an offer.
• Pressure to sign today, or reluctance to let you read the agreement.
• Promises that don’t match the paperwork, or a missing disclosure in a state that requires one.