Purpose and Goals of Factoring in Business
FactoringA is aA financial transactionA whereby a business sells itsA accounts receivableA (i.e.,A invoices) to a third party (called aA factor) at aA discountA in exchange for immediate money with which to finance continued business. Factoring differs from aA bank loanA in three main ways. First, the emphasis is on the value of theA receivables (essentially aA financial asset), not the firm’sA credit worthiness. Secondly, factoring is not aA loanA – […]