What is Factoring?
Factoring is a financial transaction whereby a business sells its invoices (accounts receivable) to a factor at a discount in exchange for immediate money with which to finance continued business. Factoring is like an open road for your business!
Factoring is a No-Debt Solution!
Unlike borrowing money to meet cash flow needs, Factoring does not weaken your balance sheet by adding debt to the liability side. Conversely, it actually improves your balance sheet by converting your receivables into cash. Loans also require collateral; therefore they are limited by your hard assets. Factoring is not a loan, so there is no debt to repay.