Invoice Factoring

What is Invoice Factoring?

When money is owed to a company, the company may be able to sell the incoming money to a third party in exchange for an upfront payment. This is generally known as invoice factoring and is a useful system for recovering money owed by customers or clients which has not been paid yet. With invoice factoring, companies can increase their cash flow and leave it to professional collection agents to obtain the debt owed.


Invoice Factoring and Debt Collection Services

An agency which provides invoice factoring may also be able to provide debt collection services for obtaining outstanding payments owed by debtors. While invoice factoring has the advantage of providing immediate results, debt collection has the advantage of impressing upon debtors the punctuality with which payment is expected, so that they are less likely to pay late in future. In the event that neither is a possibility, it may be necessary to lay a claim in a court of law, should debtors not respond to collection endeavors.