Invoice factoring, also known as accounts receivable factoring, is a financial transaction in which a business sells its outstanding invoices to a third party, called a factor, at a discount. The factor then collects payment on those invoices directly from the customers. This process allows businesses to receive immediate cash for their unpaid invoices, rather than waiting for customers to pay within their typical payment terms, which can often stretch to 30, 60, or even 90 days.






