Recourse

Recourse defines the buyer's right to come back to the seller when an asset goes unpaid. In a recourse arrangement, a provider receives cash against its claims but remains responsible for the outcome. If the payer denies or short-pays a claim, the financier can charge that amount back, and the provider has to return the money or surrender a replacement claim.

This charge-back is often called a clawback. It can arrive weeks or months after the original advance, long after the provider has spent the cash on payroll or rent. Most recourse factoring and many short-term lending products carry this feature, which means the capital was never fully the provider's to keep.

Recourse is the structural opposite of non-recourse. The presence of recourse is what makes an arrangement behave like borrowing against claims rather than an outright sale of them, because the risk of non-payment never leaves the seller.

For a practice owner, recourse is the hidden trap in capital that looks like a sale. You take the cash, you plan around it, and then a denial triggers a clawback that pulls money back out of your account on the payer's timeline, not yours. Knowing whether an arrangement is recourse or non-recourse is the single most important question to ask before signing, because it decides who eats the cost of a denied claim.

Copay does not operate on recourse. When Copay purchases your eligible claims, there is no clawback if a payer later denies one of them, because a denied eligible claim is Copay's loss, not yours. You get paid the next business day, with no personal guarantee and no change to your billing workflow, and the cash stays yours.

See how Copay purchases your claims.