Facebook Buys Unpaid Invoices from Small Businesses Owned by Certain Disadvantaged Groups

Image via Facebook Invoice Fast-Track

Facebook recently announced that it is expanding its Invoice Fast Track program, which was previously in a pilot phase. The company deemed that phase successful and, as of October 1, has expanded it to enable eligible small businesses in the United States to gain a new opportunity to get cash immediately for goods and services they’ve invoiced customers for. This is as opposed to waiting 60 to 120 days to get paid.

In other words, Facebook is helping these businesses with cash flow, and those eligible are specifically those "majority-owned, operated and controlled by racial or ethnic minorities, women, U.S. military veterans, LGBTQ+ people, or individuals with disabilities." The company is funding $100 million in invoices on an ongoing basis.

Image via Facebook Invoice Fast-Track

"First, confirm your eligibility and sign up for the program," Facebook explains. "Then, submit eligible invoices and get funded in a few days. We’ll notify your customers that they’ll pay the Facebook Invoice Fast Track program when the invoices reach term. When they pay us, we’ll use 100% of that money to help more businesses like yours."

To be eligible, invoices must have a value of at least $1,000 and be submitted to the customer for payment.

"Generally, your customers must have an investment-grade rating," Facebook says. "In most cases, participating companies must sell all eligible invoices they have with those customers. Other restrictions may apply, and not all submitted invoices will be funded."

Facebook’s community partners for the initiative include National Minority Supplier Development Council, Women’s Business Enterprise National Council, National Veteran Business Development Council, National LGBT Chamber of Commerce, Disability:IN, US Pan Asian American Chamber of Commerce, and National Veteran Owned Business Association. Additional partners include Supplier Success and Crowdz.

Facebook also announced a new small business funding resource that connects small business owners with "purpose-driven" grant and loan opportunities, business resources, and small business networking groups.

Both the funding and Invoice Fast Track announcements were made as Facebook released its State of Small Business Report. The company found that small business closures are down, indicating that a small business recovery is "underway," but also that inequalities and challenges continue to plague the business landscape. Women and minority-led businesses were more likely to be closed than the global average, it found.

Facebook’s survey found that 20 percent of women-led businesses were closed globally, compared to 16 percent of those led by males. Here in the United States, Hispanic-led businesses were the most likely to report being closed at 24 percent. Minority-led businesses in general were also more likely to report lower sales compared to the same period in the previous year.

These are the types of stats Facebook cites as motivation for the announcements it made. According to the company, over 200 million businesses use its apps every month to create virtual storefronts and reach customers.