One of the most frustrating situations for your small business is when you’re making money on paper but facing a cash crunch due to unpaid invoices. You’re working, but you have to wait until you have anything to show for it. This situation is more than just emotionally draining—unpaid invoices piling up can lead to a cash crunch, which can lead to your business shuttering. This scenario is a common state of affairs in the first few months of the year when customers are staying in due to inclement weather, and clients are slow to spend their new annual budgets. Accounts receivable financing, sometimes called invoice financing, was created precisely to help small businesses out of this specific predicament. Accounts receivable financing is a loan based on outstanding invoices. Depending on how much money you are owed through outstanding invoices, you can receive up to 80% of your receivables. The loan amounts can range from $100 to $100,000 depending on the lender, and you can expect the money as soon as 72 hours. The mechanism behind these loans is easy to understand–each loan is based on money you are owed according to your invoices. Because others already owe the money to you, the interest rates are fairly low compared to other loan types—5% is typical. The repayment period can stretch out to 1 year, so you have time to collect on your invoices and keep your business chugging forward.