Find Me Funders
Funder
Also called capital provider, funding source, the funder.
The party providing the money, named as buyer under a purchase agreement or lender under a note, as distinct from the broker who sourced the deal.
Drafted with AI assistance. Not yet independently checked. Nobody has verified the claims on this page against a source, so treat the figures and legal points as a starting point rather than as settled, and confirm anything you are about to act on. How we check things.
What it means
Funders in this market fall into a few types. Balance-sheet funders deploy their own capital or a credit facility behind it. Bank-partnered lenders originate through a chartered bank and buy the receivable afterward, a structure used to address state licensing and rate questions. Syndicated books assemble several participants into a single deal.
Syndication is worth understanding as a merchant. Several funders may share the risk on your advance, with one acting as lead. You contract with, pay and, if it comes to it, litigate against the lead. The participants are invisible to you and their existence changes nothing about your obligations, though it can slow down decisions on reconciliation or settlement because the lead may need agreement from parties you cannot see.
Servicing can sit somewhere else again. The company that calls about a missed payment is often neither the funder nor the broker.
Where this one catches people
The logo in the marketing, the entity named in the agreement, the originator on the ACH debits and the plaintiff on any eventual complaint are not always the same company. When something goes wrong, only the named party and the notice address in the agreement matter. Save the executed agreement and the notice provision at signing, because they are hard to reconstruct from a portal you have been locked out of.
Read next
Funder — common questions
What does funder mean?
The party providing the money, named as buyer under a purchase agreement or lender under a note, as distinct from the broker who sourced the deal.
Where does funder catch people out?
The logo in the marketing, the entity named in the agreement, the originator on the ACH debits and the plaintiff on any eventual complaint are not always the same company. When something goes wrong, only the named party and the notice address in the agreement matter. Save the executed agreement and the notice provision at signing, because they are hard to reconstruct from a portal you have been locked out of.
Is funder the same as an interest rate?
Funder is defined above; if you are comparing it against a rate, check whether the two measures share a time dimension before you put them side by side.
Which products does funder apply to?
It is not specific to one product — it appears across the market.
Is there a worked example of funder?
Not on this entry. Where a term is arithmetic, the arithmetic is shown; this one is not primarily a calculation.
What else should I read alongside funder?
Bank Partner Model, Broker, Direct funder, Independent sales organization, Loan servicing.
Has this definition been checked?
Not yet. This entry is drafted and live, and the notice at the top says so. Confirm anything you are about to act on.
Is this legal advice?
No. It is a definition. What a clause does in your contract, in your state, is a question for a lawyer licensed where you are.
Can I suggest a term?
Yes — [email protected]. The glossary grows from what people are actually shown in contracts.