Factoring occurs when a business sells its receivables to a finance company or bank.

Name: Factoring occurs when a business sells its receivables to a finance company or bank.
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Factoring is the process of selling accounts receivable (invoices) to a third-party financial company at a discount to obtain immediate cash. This is often done to improve cash flow and avoid the delay of waiting for customers to pay their invoices.

Factoring Occurs When a Business Sells Its Receivables to a Finance