Why the number is so large, and why it is also not the whole story
APR expresses cost per year. An advance charges its whole fee in months, and repays daily, so the average balance outstanding is about half the amount advanced. Both things push the annualized figure up. $50,000 at 1.3 is $15,000 of cost; spread over four months of daily payments, that is a yearly rate near 95 percent. Spread over eight months, near 47. The fee did not change. The speed did.
The number is real and worth knowing. It is also worth knowing what it is not: an interest rate you keep paying. The fee is fixed at signing, so the APR is the cost of the money for the months you had it, and it does not compound or continue. A business that turns $50,000 of stock into $80,000 of sales inside the term paid $15,000 to do it, whatever the annualized figure says.
How to compute yours
Total repayment minus the amount received is the cost. Divide by the amount received for the cost as a fraction. Divide by the term in days and multiply by 365 for a simple annualized rate; a true APR that accounts for daily repayment is roughly double that, because on average only half the money is outstanding. $10,000 at 1.25 with a $300 fee: $12,800 back, $2,800 cost, 28 percent of the amount; over 180 days that is about 57 percent simple and around 100 percent as a true APR.
Our calculator does this for any amount, factor and term, and shows the comparison against the other three products.
What to compare instead of APR alone
Total dollars repaid over the term, for each offer, including fees. Whether the fee is fixed or accrues. What the money produces inside the term. And what the alternative actually is: not a bank loan at 9 percent you were declined for, but the cost of not having the money this week. APR is the right tool for comparing two advances of different lengths. It is the wrong tool for deciding whether to take one at all, because it annualizes a decision that lasts six months.