Advantage Factor, LLC - What is Factoring?

Advantage

Factor, LLC

What is Factoring?

Many businesses factor (sell) invoices and don’t even realize it. A merchant that accepts credit cards as payment receives a discounted amount from the credit card company for factoring its sales. The merchant gets his money quickly and the credit card company waits for payment from the customer. Selling a commercial invoice, or factoring, is no different.

Factoring is not a loan. There is no debt repayment, no compromise to your balance sheet, no long-term agreements or delays associated with other methods of raising capital. Factoring is a form of business financing which utilizes a company’s accounts receivable (invoices) to provide immediate cash for operating expenses and growth.

Simply put, a Factor buys invoices from a business at a reasonable discount.