Oilfield factoring
Oilfield factoring companies: getting paid while the operator's 60-day clock runs
Oilfield hauling pays on the operator's schedule, not yours. Water, sand, pipe and equipment loads get billed to operators and service companies through approval portals, often on long terms. Oilfield factoring advances most of each approved invoice so fuel and payroll don't wait. Here's what factors need, how portals slow you down, and how much cash long terms really tie up.
How customer approval portals delay oilfield factoring
Many operators and large service companies accept invoices only through their own e-invoicing or AP portal. The payment clock often starts when the invoice is approved there, not when you hauled.
- 01
The ticket must match the PO
The field ticket, purchase order or work order number and the invoice lines have to agree exactly, or the portal kicks it back.
- 02
Someone in the field has to approve
A company man or supervisor signs or approves the ticket. If they're slow, your invoice waits before terms even start.
- 03
The factor may wait for approval too
Many factors want to see the invoice approved in the portal before they advance, because an unapproved invoice is easier to dispute.
- 04
Remit-to changes take time
Getting an operator to update your remit-to for a factor's notice of assignment can take a vendor-setup process of its own. Start it early.
Oilfield invoices with long terms: weeks of cash on the table
Set your weekly invoicing, your customer's pay terms and how long portal approval takes. The stack shows how many weeks of invoices are always waiting, and the dollars behind them. That number is what oilfield factoring frees up.
Unpaid at any moment
$90,000
10 weeks of invoices waiting (67 days from invoice to payment)
EXAMPLE math: weekly invoicing x weeks from invoice to payment. Terms vary by operator and contract; use the terms on your MSA or PO.
Cash planning for long oilfield terms
Long terms don't just delay one invoice; they keep a rolling block of your revenue unpaid all the time. In the EXAMPLE above, 60-day terms plus a week of portal approval keep about 10 weeks of invoices waiting. Grow your fleet and that block grows with it.
Factoring shrinks that block to a few days, at a fee on every invoice. Before you sign, check two things. First, will the factor buy invoices from your specific operators and service companies, and on what terms? Second, how does the fee change if an operator pays on day 75 instead of day 60? Tiered fees can make long terms expensive.
Oilfield factoring for hotshot, water and sand hauling
Different oilfield work produces different paperwork. Factors need the right backup for each.
| Work | Usually billed | Backup a factor wants |
|---|---|---|
| Hotshot runs (parts, tools, equipment) | Per load or per mile, often through a broker | Rate con, BOL, signed POD |
| Water hauling | Per barrel or per hour | Field tickets with barrels or hours, signed on site |
| Frac sand | Per ton or per load | Scale tickets and delivery tickets |
| Rig and equipment moves | Per job or per hour | Signed work ticket and PO number |
| Pipe and tubulars | Per load | BOL and signed delivery ticket |
Billing methods vary by customer. Hotshot loads booked through freight brokers factor like any other freight invoice.
Field ticket habits that get oilfield invoices funded faster
The same ticket discipline that keeps dump haulers out of disputes works in the patch. Most funding delays start with a ticket problem, not the factor.
- 01
Get the ticket signed before you leave location
The company man or supervisor signs, prints a name and dates it. A ticket signed days later from memory invites a dispute.
- 02
Write the PO or AFE number on every ticket
If the operator gave you a purchase order, work order or AFE number, put it on the ticket and the invoice. Portals match on it.
- 03
Record quantities the way you bill
Barrels, hours, tons or loads, exactly as the invoice will show them. Rounding on the invoice that doesn't match the ticket gets rejected.
- 04
Photograph and upload the same day
Tickets get greasy, wet and lost. A clear photo is your backup, and same-day uploads keep the portal clock moving.
- 05
Track approvals weekly
Check which invoices are still pending in the portal every week. An invoice stuck in approval isn't on terms yet.
Choosing among oilfield factoring companies
Ask every factor
- Will you buy invoices from my operators and service companies?
- Do you advance before or after portal approval?
- How does the fee change at 60, 75 and 90 days?
- Can you manage the operator's vendor setup for your NOA?
- Is there a monthly minimum if drilling activity slows?
Walk away if
- They only buy freight broker invoices
- The fee has no cap on slow invoices
- They can't explain how they handle portals
Hotshot loads for the oilfield and everywhere else
7% for hotshots. No setup fee. Month-to-month.
EXAMPLE hotshot week
Example- Gross
- $6,200
- Fee 7%
- -$434
- You keep
- +$5,766
Oilfield factoring questions
What is oilfield factoring?
Selling invoices you've billed to operators or oilfield service companies to a factor, which advances most of each invoice and collects from your customer on its terms. It's the same as freight factoring, with different paperwork: field tickets, POs and portal approvals instead of just rate cons and PODs.
Can I factor oilfield invoices with long terms?
Often, yes, if the factor approves your customer's credit. Long terms usually cost more on tiered fee schedules, because the fee rises the longer the invoice is out. Ask how the fee works at 60 and 90 days, and whether the factor waits for portal approval before advancing.
What documents do factors need for oilfield work?
Your invoice, the signed field or work ticket, the PO or work order number, and proof of portal approval if your customer uses one. For per-ton or per-barrel work, the scale or barrel tickets. For hotshot runs booked through brokers, the usual rate con, BOL and signed POD.
Do you dispatch oilfield hotshot loads?
We dispatch hotshots, and that includes freight that serves the oilfield when brokers post it. Every load comes to you as an offer with lane, miles, weight and rate, and you confirm or pass. Hotshot dispatch is 7% of gross, no setup fee.
We refer carriers to RTS Financial and may be paid for referrals. It doesn't change your rate. Disclosure. RTS Financial publishes cash in 24 hours or less, with same-day pay after uploading invoices in the RTS app for freight factoring. See also hotshot dispatch and freight factoring.
Ask whether your operators qualify
Referral to RTS Financial. We may be paid for referrals.