FACTORING

Accounts receivable factoring is the sale of your accounts receivable (invoices) at a discount off the face value in return for immediate cash. The funding source is known as the factor or trade finance company.

The primary benefit is to provide immediate working capital, allowing you to compete with larger companies by offering customers better payment terms. In addition, it protects your business from losses (credit risk) as the factor may assume the responsibility for the customer's financial ability to pay and perform credit, collection and related bookkeeping functions.