PayUp Receives $5M Line of Credit to Factor Invoices for SMBs

Early payment solutions provider PayUp, a Rex company, has received a $5 million line of credit from private working capital finance company nFusion Capital and said this would allow it to factor $50 million in invoices.

Both PayUp and nFusion Capital focus on small to medium-sized businesses (SMBs), and the new partnership will use PayUp’s tech-enabled early payment solution to provide SMBs with access to capital that’s convenient and affordable, the companies said Tuesday (Nov. 22) in a press release.

This partnership comes when 87% of vendors don’t qualify for traditional lending, even as they’re coping with higher labor and materials prices due to inflation and shortages, Rex Founder and Executive Chairman Peter Rex said in the release.

“PayUp is building technology to manage the arbitrage in credit worthiness between these vendors and customers,” Rex said. “A line of credit from a partner like nFusion Capital is only going to help PayUp meet that rising demand.”

With its early payment solution, PayUp expedites payments between businesses and their customers, provides an experience that fits into their existing invoicing workflows, and provides instant verification and predictable payouts, according to the press release.

The company launched in May and has processed thousands of invoices totaling $1.5 million in payments, the release said.

“We are excited to partner with PayUp and provide the capital they need to continue to grow their market,” nFusion Capital CEO Jason Lippman said in the release.

As PYMNTS reported in August, access to trade finance can facilitate SMB engagement in trade by addressing two significant challenges.

First, buyers and sellers face significant counterparty risks when exploring new markets and dealing with new customers and suppliers.

Second, SMBs are often constrained in working capital because buyers and sellers have diverging preferences with respect to the ideal point of time for making payments.