The best purchase order financing depends on the size of the order and your track record. Merchant Fund Express, our recommended funder, fits small and mid-size orders and businesses that don't qualify for traditional PO financing, because it provides working capital from $5,000 to $5,000,000 with decisions that often come in 2 to 4 hours. King Trade Capital, Gateway Trade Funding and 1st Commercial Credit are purchase order specialists for wholesalers, distributors and importers. SBA programs like the Working Capital Pilot, Contract CAPLine and Export Working Capital cost less for contractors and exporters with solid financial statements.
Purchase order (PO) financing pays your supplier so you can deliver an order you already have from a creditworthy customer. Below we compare each option on concrete criteria, using facts from their official sites and sba.gov (checked October 20, 2026). Leer en español.
Key takeaways
- For speed and small orders: our recommended funder, with amounts from $5,000, FICO 500+ and decisions that often come in 2 to 4 hours.
- For specialized PO financing: King Trade Capital, Gateway Trade Funding or 1st Commercial Credit, which mainly evaluate your customer and your supplier.
- 1st Commercial Credit requires you to factor your invoices with it to get PO financing; Gateway says it finances up to 100% of the cost of presold inventory.
- For contracts and exports: the SBA's 7(a) Working Capital Pilot or CAPLines (up to $5,000,000) and the Export Working Capital Program.
- PO financing is for physical goods already sold, not for services or for inventory with no buyer.
- It's almost always paired with factoring: the factor collects the invoice from the customer and pays off the PO funder.
How we chose
How we chose. We don't hand out made-up ratings or scores. We compared each option on the same criteria: decision speed, minimum time in business, minimum credit, whether it accepts an ITIN or owners without an SSN, documents required, amounts and collateral. We only use facts each company publishes on its official site or that the SBA publishes on sba.gov; if a fact couldn't be confirmed, we left it out. For PO financing we added one more criterion: how large or small an order can be, because many specialists won't take small orders. Read the full methodology in how we rank business funding options.
If this is your first time hearing about the product, start with our explainer on how purchase order financing works, which walks through the process step by step.
The best purchase order financing options, ranked
Merchant Fund Express (recommended funder). This isn't classic PO financing: it's working capital that lands in your account so you pay the supplier yourself. That makes it useful exactly where the specialists don't reach: small orders, businesses with a short track record, or when you also need to cover freight, labor or duties. It reviews your sales and deposits along with your credit, considers FICO 500+, handles $5,000 to $5,000,000 and doesn't require collateral in most cases. It offers Spanish-speaking support and accepts applicants with an ITIN, no SSN needed.
King Trade Capital. It presents itself as a specialist in purchase order and trade finance, with domestic and international solutions, including letters of credit. It funds small and mid-size companies based in the U.S., Canada or the U.K. and works alongside banks, factoring companies and asset-based lenders. A good fit if you already have a bank or factoring relationship and are only missing the money to produce or buy the order.
Gateway Trade Funding. It says it finances up to 100% of the cost of presold inventory, for domestic and international orders, without touching your existing credit line. It also offers export financing, lines of credit and term loans. It suits wholesalers and importers who get orders bigger than their capital allows.
1st Commercial Credit. It has more than 20 years in PO financing and facilities from $10,000 a month up to $10 million. Watch the requirement: you must be factoring your invoices with it to apply for PO financing. It funds finished goods and, for U.S. importers, payments to foreign suppliers, logistics and duties. For production funding it requires 2 years in business and being current on rent and taxes.
SBA 7(a) Working Capital Pilot or Contract CAPLine. The Working Capital Pilot offers monitored lines up to $5,000,000 for businesses with at least a year of operations that want to fulfill large contracts or borrow against receivables or inventory. The Contract CAPLine funds the costs of one or more specific contracts. They usually cost less than private PO financing, but they require current financial statements and more time. Since March 1, 2026, every owner of a 7(a) applicant must be a U.S. citizen or national.
SBA Export Working Capital Program. For businesses generating export sales that need capital to fulfill them. The SBA guarantees up to 90% of the bank's loan, and export inventory and foreign receivables generally serve as collateral.
Comparison table
| Option | Type | Published amount | Key published requirement | Order type |
|---|---|---|---|---|
| Merchant Fund Express | Working capital | $5,000 to $5,000,000 | FICO 500+; reviews sales and deposits | Small or mid-size, urgent |
| King Trade Capital | PO financing and letters of credit | Not published | Company based in the U.S., Canada or U.K. | Domestic or international |
| Gateway Trade Funding | PO and export financing | Up to 100% of presold inventory cost | Order already sold | Domestic or international |
| 1st Commercial Credit | PO financing with factoring | $10,000 a month to $10 million | Already factoring invoices with it | Finished goods and imports |
| SBA Working Capital Pilot or CAPLine | SBA-backed line | Up to $5,000,000 | 1 year operating and financial statements | Large contracts |
| SBA Export Working Capital | Export line | Set by the bank | Export sales | Orders from foreign customers |
If you qualify for an SBA program, it usually costs less than any private option in this table. The problem is time: an order with a close delivery date can't always wait.
How PO financing works and how it's priced
- You receive a purchase order from a creditworthy customer, for example a retail chain, a distributor or a government agency.
- You get a quote from your supplier and present it to the funder along with the order.
- The funder pays the supplier, often with a letter of credit, so it produces or ships the goods.
- You deliver the order and invoice the customer.
- The customer pays, usually to a factoring company or directly to the funder. The funder deducts what it's owed plus its fees and sends you the rest.
The cost is usually charged as a percentage for each period the money is out, so the longer your customer takes to pay, the more you pay. That's why PO financing works best with comfortable gross margins and customers who pay on time. Before you sign, get in writing the fee per period, how long each period lasts and any other fees, such as letter of credit issuance or supplier review.
The key difference: PO financing pays before you deliver; factoring advances money after you invoice. Many businesses use both in the same transaction. Read the full comparison in PO financing vs. factoring.
What purchase order funders ask for
- A firm purchase order from a customer with good credit. The funder looks at your customer more than at you.
- A reliable supplier with a history of delivering on time and at the agreed quality.
- Finished or nearly finished physical goods. Services, software and orders that require a lot of in-house manufacturing are harder to finance.
- Enough margin to cover the financing cost and still leave you a profit.
- Documents: the purchase order, the supplier quote, a pro forma invoice, your history with similar orders and, in some cases, financial statements.
- A factoring agreement or an assignment of the customer's payment, so the funder gets paid directly.
If your business is new but your customer is a large company with a good payment record, you may still qualify with a specialist. If the problem is that the order is small or the customer isn't well known, working capital is usually the more realistic route.
Common mistakes and how to avoid them
- Accepting an order without adding up the total cost. Add the product, freight, duties and financing before you say yes.
- Underestimating timelines. If your customer pays in 60 days and production takes 45, the money will be out for more than 3 months. Price the deal on that timeline, not the ideal one.
- Relying on a single customer. If that customer cancels or pays late, the funder will come to you for repayment.
- Not vetting the supplier. If it delivers late or poorly, the customer can reject the goods and you're left with the debt.
- Using PO financing for inventory with no buyer. That's what inventory financing is for; compare them in PO financing vs. inventory financing.
Have an order you can't fill without capital? Apply with our recommended funder; it's free and won't affect your credit.
Frequently asked questions
Can I get PO financing if my business is new?
Sometimes, yes. Purchase order specialists mainly look at the strength of your customer and your supplier, not just your history. But some require time in business for certain order types; for example, 1st Commercial Credit asks for 2 years to fund production. If you're turned down, working capital based on sales and deposits may be the alternative.
What's the difference between PO financing and factoring?
PO financing pays your supplier before you deliver the order. Factoring advances money on an invoice you've already issued after delivery. Many businesses use both in sequence: PO financing produces the goods, and factoring collects the invoice and pays off the PO funder.
Does PO financing work for service businesses?
Generally no. It's designed for physical goods that a supplier makes or delivers. If you run a service business, such as cleaning, construction or consulting, invoice factoring, a line of credit or, for large contracts, the SBA's Contract CAPLine through a bank are more common.
How much does purchase order financing cost?
There's no single rate. It's usually charged as a percentage for each period the money is out, plus fees for letters of credit or other services. The longer your customer takes to pay, the more you pay. Get the fee per period, the length of each period and every extra fee in writing before you accept.
Does the SBA offer purchase order financing?
Not directly, but it backs bank loans that serve the same purpose: the Contract CAPLine funds the costs of specific contracts, the Working Capital Pilot offers lines up to $5,000,000 to fulfill large contracts, and the Export Working Capital Program funds export sales. Since March 2026, all owners must be U.S. citizens or nationals for 7(a) loans.
What if my order is too small for a PO specialist?
Many specialists prefer mid-size or large orders. For a small one, compare working capital or a line of credit. Merchant Fund Express works with amounts from $5,000, reviews your sales and deposits and often decides in 2 to 4 hours, so you can find out quickly whether you can take the order.