Qualifying and receiving approval for factoring is a fast and straightforward process that takes only a matter of days. One of the critical differences between factoring and a loan is the credit standards. With a loan, the bank bases approval on the client’s credit. Factoring companies determine approval based on the credit and payment history of the client’s customer. Factoring is not a loan, but rather the sale of an asset (open invoices). There is no interest charge with factoring. The cost of factoring is known as the fee. Factoring fees are calculated by how long it takes your customer to pay the invoice.