Factoring is a type of cash flow funding which allows you to receive money upfront from unpaid invoices as soon as they are generated.
Typically, a business sells its invoices, or receivables, to a third-party financial company (called a “factor”) at a discount. The factor then collects payment on those invoices from the business’s customers.
Factoring dates back to Ancient Rome and was prevalent in commodity financing in Great Britain as early as the mid-1600s. Today, it is used by all kinds of businesses ranging from Manufacturing, Retail, Staffing, Government, Hospitality and is especially prominent in Trucking and Transportation.
If your company is growing and needs cash for raw materials, salaries, hiring, equipment, or even taxes, Factoring makes sense and easily handles the cash needs of your business.