Government Contractor Financing

Government contractor financing is a way to access the cash trapped in your unpaid federal invoices before the government pays them. The most common form is invoice factoring: you sell an approved receivable to a funding partner and get most of its value — up to 90% — right away, rather than waiting 30 to 90 days for the agency to remit.

It exists because of a structural mismatch in GovCon. Federal contracts pay on Net-30 to Net-90 terms, but your costs — payroll, subcontractors, materials, bonding — come due long before the check arrives. Financing closes that gap so you can operate and grow without floating the receivables yourself.

Get paid in days, not months. Instead of waiting out the federal payment cycle, you receive up to 90% of an approved invoice in as little as 48 hours.

Grow without giving up equity. Financing isn't a loan and isn't an investment — it's your own earned receivables, accelerated. There's no fixed monthly payment, no debt on your balance sheet, and no dilution.

Access capital when you need it most. Your funding line grows automatically with your contract volume, so winning a bigger award expands your cash instead of straining it.

First, you submit your approved government invoice. Encore then advances up to 90% of its face value, typically within 48 hours of approval. We wait for the government to pay on its own schedule. When the agency remits, you receive the remaining balance, less a transparent fee quoted to you up front.

Because the Assignment of Claims Act lets contractors direct federal payment to a financing partner, the whole process is a routine, compliant transaction — and Encore handles the paperwork for you.

Make payroll on time, every cycle — critical for staffing firms paying workers weekly against Net-30+ terms.

Take on bigger awards and new task orders you'd otherwise have to pass on for lack of working capital.

Cover operating expenses — subcontractors, materials, bonding, rent, and insurance — without waiting on the government.

Encore finances prime contractors and subcontractors across the industries where the cash-flow gap bites hardest. We have dedicated programs for government staffing firms, construction contractors, IT and professional-services firms, and small businesses and subcontractors of every set-aside type — 8(a), WOSB, SDVOSB, VOSB, and HUBZone.

If you invoice a federal agency on net terms, you likely qualify. Explore the financing program built for your business from the links at the bottom of this page.

Versus a bank loan: factoring isn't debt, requires no fixed monthly repayment, and underwrites against the government's credit rather than just yours — so it's faster and more accessible for growing contractors.

Versus a line of credit: a credit line has a fixed ceiling, but a factoring line scales automatically with your invoiced contract volume, so it grows as you win more work.

Versus a merchant cash advance (MCA): factoring is dramatically cheaper and isn't a high-cost debt product — it simply advances money you've already earned. See the detailed comparisons linked below.

Government contract factoring is one of the most affordable forms of business funding because the federal government is a low-risk payer. Pricing is a transparent fee charged as a percentage of the invoice amount — no hidden costs, no fixed monthly payment, and no charge on invoices you choose not to factor.

Your exact rate depends on your contract volume and invoice terms. Submit the form for a no-obligation quote and a funding specialist will walk you through the numbers for your situation.

Getting started is simple. Most contractors need a list of their government customers, a brief funding application, and an accounts-receivable aging report showing your outstanding invoices. There's no lengthy bank-style underwriting.

Encore was founded by the original Advance Partners team and has deployed over $25 billion in funding. We understand FAR, prompt-payment timelines, and contract mods — so approvals are faster and underwriting actually fits how GovCon works.