Referral Compensation
Referral fee structures define how brokers, vendors, and advisors are compensated when they introduce financing opportunities. Understanding revenue share, commission splits, and agreement terms helps referral partners evaluate programs and set expectations.
Referral partners introduce opportunities; the financing partner evaluates, places, and services the deal. The fee structure determines how revenue is shared when a transaction funds. Understanding the structure helps partners compare programs and plan for compensation.
In commercial finance, referral fee structures are typically defined in the signed referral agreement. The agreement specifies how compensation is calculated—whether as a percentage of gross commission, a flat fee per funded deal, or another model. Structures vary by financing partner, product type, and sometimes by partner role. Brokers, equipment vendors, CPAs, and consultants may see different arrangements depending on the program.
Revenue share is a common structure in commercial finance referrals:
Revenue share means the referral partner receives a percentage of the gross commission or revenue the financing partner receives from a funded transaction. For example, if the financing partner earns $10,000 on a deal and the agreement specifies 35% revenue share, the referral partner receives $3,500 when the deal closes. Percentages vary by program—often in the 25–40% range depending on deal type, partner role, and program design.
Revenue share aligns incentives: both parties benefit when deals fund. The referral partner is motivated to send qualified opportunities; the financing partner handles evaluation, placement, and servicing. Learn more about how commercial lending referral fees work and when referral commissions are paid.
Equipment vendors, brokers, CPAs, and consultants may have different fee structures depending on the financing partner's program. Vendors who refer equipment financing opportunities may have arrangements tailored to vendor programs. Brokers in the ISO program may have different terms than CPAs or consultants. The referral agreement specifies the applicable structure for each partner type.
Partners should review the agreement to understand their specific fee structure. Questions about how compensation is calculated can be directed to the financing partner before signing. See can vendors get paid for referring financing for vendor-specific context.
Referral fees are paid only when a transaction funds. Introductions that do not result in closed deals do not generate compensation. The fee structure applies to successful placements—deals where the borrower closes with a lender and the financing partner receives its commission or revenue.
This structure protects the financing partner from paying for unfunded volume and aligns compensation with results. Referral partners who send qualified opportunities increase the likelihood of funded deals and corresponding fees. The referral agreement defines the structure; payment timing is typically within 30 days of funds received.
Compensation is documented in the signed referral agreement. The agreement defines the fee structure, payment timing, clawback terms, and any conditions. Referral partners must review and sign the agreement before submitting deals. Without a signed agreement, there is no binding compensation structure.
Partners interested in sending declined deals or other opportunities should start with the referral agreement. Understanding referral fee structures is part of due diligence before participating in any referral partner program.
FAQ
Common structures include revenue share (percentage of gross commission or revenue from the funded transaction), flat fees per funded deal, and tiered arrangements based on volume. The structure is defined in the signed referral agreement.
Revenue share is a percentage of the gross commission or revenue the financing partner receives from a funded transaction. The referral partner receives that percentage when the deal closes. Percentages vary by program—often in the 25–40% range depending on deal type and partner role.
Yes. Equipment financing, working capital, term loans, and other product types may have different fee structures. The referral agreement typically specifies how compensation is calculated for each product category.
No. Referral fees are paid only when a transaction funds. Introductions that do not result in closed deals do not generate compensation. Payment is contingent on successful placement.
Compensation is documented in the signed referral agreement. The agreement defines the fee structure, payment timing, clawback terms, and any conditions. Referral partners should review the agreement before submitting deals.
Fee structures may vary by partner type. Equipment vendors, brokers, CPAs, and consultants may have different arrangements depending on the financing partner's program. The referral agreement specifies the applicable structure for each partner.
Understand your compensation
The agreement defines fee structure, payment timing, and clawback terms.
