What Is Factoring?

Invoice Factoring and discounting works as follows: The invoice factoring company fully manages your sales ledger and provides you with credit control and collection services of all your outstanding debts. The invoices you issue upon a sale are sent to the Invoice Factoring Company who typically advances up to 90% of the invoice amount to you. The balance, less a management charge, is paid when the customer makes payment directly to the factoring company. The service is disclosed to your customer who typically receives a letter from the Invoice Discounting, or attached note to your invoice, containing payment instructions to your invoice factoring and discounting company.