what is factoring



what is factoring..

Answer / muniyaraj m

Factoring is a financing option in which firms raise cash by selling their accounts receivable at a discount from face value. Most factoring transactions made today actually are structured to be more like short-term loans with receivables pledged as collateral. Under this scenario, the firm pledging the receivables in return for funding still retains the risk associated with uncollectible receivables.

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