Unpaid versus Factoring: which solution do you choose?

How do you improve your cash flow? It is not always easy for you, as an entrepreneur, to decide which solution suites you best. Factoring is one of the many solutions which are worth considering, At Unpaid we however believe that in many cases, our solution is better suited. We briefly explain the difference between factoring and our services.


Factoring is a form of financing. A third party - the factor - stands between you and your clients. The factor immediately pays an advance on the invoice and monitors the payment. The advance varies. Usually this is up to 85%. After the factor has collected the invoice, they withhold a commission and pay the rest.

This form of financing quickly improves your cash flow position. You immediately receive a substantial advance on your invoices. Meaning there is no need to postpone your investments. Factoring however comes with a hefty price tag. For example, if you have to surrender 2% on your invoice, and therefore you can get your money 2 months earlier, then you have a financing cost of 12% on this interest (1 year = 12 months divided by 2 months = 6 x 2% = 12%)

Often the factoring company that you work with will request to take over all your invoices. As a result they will skim off all of your invoices. You immediately lose part of your turnover, before the invoice even reaches you client’s mailbox. If you wish to retain the same profit margins, you are obliged to charge these costs. You are therefore also punishing your good clients.

Also, factoring companies are sometimes selective in accepting their customers. Your company will only be eligible from a certain turnover figure. As a result, many small businesses and start-ups are immediately disqualified. The factor will often also analyse your client base. If they label your client base as risky, then factoring is not an option. The criteria handled for this are very conservative at times.

In addition, customers regularly consider factoring as a sign of distrust. You completely outsource the handling of your invoices. A friendly payment reminder is no longer possible. Stickers on the invoice must make it clear that the invoice must be paid on the account number of the factor. Factoring often causes confusion. The entire outsourcing process feels impersonal and sometimes leads to a less good relationship with the customer.


At Unpaid we do not provide financing. We go in pursuit of your money in the legal way. This used to take up a lot of time. But due to a change in legislation in 2016, these days, Unpaid collects your money without having to go to court. Our bailiff demands the payment directly from your client. On average, we recover 89% of all claims within 38 days. This means that we collect your invoices extremely quickly and efficiently.

As our customer, you only pay an advance. Moreover, we recover this advance from your client. In principle our services therefore cost you nothing at all. During a successful procedure we therefore recover 100% of the invoice amounts, as well as all advanced costs

With your solution you decide for yourself which files you send to us. We do not oblige anyone to have us collect a fixed number of, or all invoices. You also do not pay any fixed subscription costs. If you use Unpaid, you pay nothing. We do however recommend that you submit unpaid invoices quickly. You are in control. You decide yourself which invoices must be collected by Unpaid. 


In a limited number of cases, factoring is an interesting, but expensive solution. You use your own invoices as collateral to receive financing. On the other hand, factoring entails a lot of obligations and costs. Only a limited number of companies are eligible, based on strict criteria.

Unpaid provides the most flexible solution. Every company with B2B receivables can make use of our services. You choose for yourself at when and which invoices you send. Unpaid gets to work immediately and collects quickly and efficiently. Moreover, at Unpaid, with a successful collection, you receive 100% of the invoice amount and all advanced costs.

Do you want to improve your cash flow, in the long term? Then choose Unpaid. Tackle defaulters efficiently and resolutely and save yourself loads of frustration. Invoices are submitted completely on-line. Then we get started. You can submit your invoice here:

Ready to start collecting?

Enter your VAT number and we will handle the rest.

Do you have an unpaid invoice or do you have questions about how Unpaid works? Call +32 9 396 34 00 or let us know when you want to be called.