Review:
Invoice Factoring
overall review score: 4.2
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score is between 0 and 5
Invoice factoring, also known as accounts receivable financing, is a financial transaction where a business sells its invoices to a third party at a discount in exchange for immediate cash.
Key Features
- Quick access to cash flow
- Improved liquidity
- Reduction in accounts receivable risks
- No debt incurred
Pros
- Provides immediate cash flow for businesses
- Helps maintain steady operations during slow-paying customers
- No debt is incurred as this is not a loan
Cons
- Discounted rates can affect profit margins
- May not be suitable for all industries or businesses