Factoring: Accounts Receivable, Cash Flow And Factoring Invoice

Date Added: Jan 2010
Format: HTML

Factoring is the exchange of a company's commercial invoices or accounts receivable into immediate cash. This is done by selling those accounts at a discount. With invoice factoring, you can easily get 70 to 80% of an invoices face value wired to your account within 24 to 48 hours of the invoice being issued and approved. It's an easy way to get ready cash. There is a misconception that invoice factoring is a kind of loan. This is absolutely wrong, as with factoring you pay neither interest nor principal. Invoice factoring is not a loan. The main benefit of invoice factoring is that no liability will appear on a company's balance sheet due to factoring; furthermore, it financially revitalizes the business.