Invoice Financing / Factoring
Selling or borrowing against receivables to manage cash flow.
Detailed Description
Invoice Financing / Factoring
What is the primary purpose of invoice financing?
The primary purpose of invoice financing is to provide businesses with immediate cash flow by using outstanding invoices as collateral.
What are the two main types of invoice financing?
The two main types of invoice financing are factoring and invoice discounting.
How does factoring differ from invoice discounting?
In factoring, the lender takes over the collection of invoices, while in invoice discounting, the business retains control over collections.
What is a major drawback of invoice financing?
A major drawback is the cost, as fees can be higher than traditional financing options.
Who are the key players in the invoice financing market?
Key players include traditional banks, fintech companies, and specialized factoring firms.