Quick answer
SBA loans are cheaper but take 30–90 days and require strong credit and collateral. AR financing costs more but funds in days and scales with sales. Many companies use both.
Speed
AR financing: days. SBA 7(a): typically one to three months.
Cost
SBA rates are often prime plus 2.75%–4.75% annually; AR financing runs 0.75%–3% per 30 days.
Best use
SBA for long-term assets; AR financing for working capital tied to receivables.
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Written and reviewed by the National Invoice Factoring funding team — specialists in receivables and trade finance since 2009.
