Sometimes a company would like to factor a single invoice. This is commonly called “spot factoring.†It usually involves a significantly large invoice. Most factoring companies will not do spot factoring due to the risky nature of the transaction. It’s because if there is a problem with the account debtor paying the invoice there will be little or no recourse available. So the first step would be to determine the creditworthiness of the customer who owes on the invoice. Unless they are a Fortune 100 company, there’s not going to be much appetite from a factoring company to do spot factoring. The next thing a factoring company will look at will be the contract. How ironclad is the language regarding payment for services rendered?
So the main reason factoring companies shy away from spot factoring is there is a lot of work that goes into getting the account started with the client and completing proper due diligence on the client’s customer. A factoring company would much rather rely on an ongoing relationship with a variety of account debtors.