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Quick Pay Fee Math in Plain Numbers: Cost Per Day Early

A 2% quick pay fee can cost 17.7% or 62.1% a year depending on the days it buys. Three invented offers, one formula and the questions to ask the broker first.

5 min read

Three bars of simple yearly rate for the same 2% quick pay fee: 17.7% when it buys 42 days, 26.6% for 28 days and 62.1% for 12 days (example data)17.7%26.6%62.1%42 days early28 days early12 days earlySame 2% fee on $2,400, simple yearly rate (example data)

Why this matters. A broker offers quick pay for 2%. That sounds small, so it gets accepted on the next invoice, and the one after. But 2% is not a price until you know what it buys. If it buys 42 days, it is spread over a long time. If it buys 12, the same 2% costs several times more per day. The percent is half the answer. The days are the other half.

A ruler, not a quote

All offers below are invented. We name no brokers and quote no market fees. The yearly rate is a simple comparison figure with no compounding and no extra terms, and it is not an APR under any law. Use the terms in your own paperwork.

The formula

Three steps. Take the fee. Divide it by the cash you actually receive, not the invoice total. Scale it to a year and divide by the days early.

simple yearly rate = fee / cash received x 365 / days early

Days early is the gap between the date quick pay lands and the date the broker would normally pay. The fee buys that gap.

Three offers on the same method

Example data: quick pay cost per day early
OfferFeeCash receivedDays earlySimple yearly rate
2% on $2,400$48$2,3524217.7%
3% on $3,000$90$2,9102545.2%
4% on $2,400$96$2,3042854.3%

Fee and days are invented. Yearly rate = fee / cash received x 365 / days early, rounded to a tenth of a percent.

The 2% offer is the cheapest per day, 17.7% a year, because it buys 42 days. The 3% offer costs 45.2% because it buys only 25. The 4% offer is the dearest at 54.3%, and the extra point of fee buys just 3 more days than the 3% offer.

One fee, three payment speeds

Take the first offer: a $2,400 invoice and a 2% fee of $48. You receive $2,352. Now hold the fee and change the broker's normal pay day.

Example data: same 2% on $2,400, different days early
Normal pay dayQuick pay landsDays earlySimple yearly rate
Day 45Day 34217.7%
Day 31Day 32826.6%
Day 15Day 31262.1%

Invented dates. Fee over cash received is 2.04% in every row. Only the days change.

That is the whole lesson. A broker who pays in 15 days leaves you 12 days to buy. A broker who pays in 45 leaves 42. Taking quick pay from the second broker is cheaper per day by a factor of 3.5 on the same percent.

When early cash is worth the fee

The fee should be compared with what else you could get this week. A credit line, a card balance, a late fee you would otherwise pay or a fuel stop you would otherwise miss. Our pay or wait calculator does the comparison on your numbers, with quick pay, factoring and waiting side by side. In its own example, a 2% fee that brings cash 28 days sooner works out to about 26.6% a year.

Small fees add up. Total quick pay fees by month so you see the sum and not just the single charge. A $48 fee every week is $2,496 over 52 weeks, and it comes straight out of your margin.

Ask before you accept

Subject: Quick pay terms, [broker name] Please send in writing: the quick pay fee, the day cash arrives after approval, and whether the fee changes with invoice size. Also confirm how detention and short pay disputes are handled after early payment.

The last question matters. Some brokers treat a detention line or a short pay differently once the invoice is paid early. We do not know your broker's terms, so we assume nothing. Get the answer in writing and keep it with the load file.

A worked example for your own invoice

Take the last invoice a broker offered quick pay on. Write four numbers on one line: the fee, the cash you would receive, the day quick pay would land and the day the broker normally pays. Say the fee is $60, the cash is $2,940, quick pay lands on day 4 and the normal day is day 34. Days early is 30. The simple yearly rate is $60 / $2,940 x 365 / 30, which is 24.8%. Those figures are invented, but the four-number line works for any invoice, and it takes under a minute.

Then ask what the same cash would cost elsewhere this week. If the answer is a card at a lower rate, the card wins. If the answer is nothing you can actually get in time, the fee may be the right price for the days. Writing the comparison down is the useful part, because it stops quick pay from becoming a reflex.

Where the math goes wrong

  • Comparing percentages. 2% on 42 days early and 2% on 12 days early are different deals.
  • Dividing by the invoice. The fee comes out of the invoice, so divide by what you receive.
  • Treating it as a habit. Early cash that is needed every week points at a cash gap, not a one-off.

Common questions

  • Is quick pay the same as factoring? No. Quick pay is offered by the broker on its own invoice. A factor is a third party that buys invoices. Our factoring vs quick pay comparison sets the two side by side.
  • Why use a yearly rate for a single invoice? It makes different offers comparable. You will not pay it for a year. It is a ruler for fee per day early.
  • Can the broker change the fee later? Possibly. Read the terms or the agreement you accepted and save a copy of the fee schedule.
  • When is quick pay worth it? When the cash lets you avoid something costlier, such as a late payment or a missed fuel stop. Price that with your own numbers.

The quick pay fee math guide has the five steps and a message you can copy. Not sure what you have paid in fees over the last few months? Send us your last 20 loads and we will total them.

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