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Is factoring used only by companies in financial trouble?
Answered By Editor
Not necessarily. Factoring provides a way to
minimize the risk from bad debts. Selling
your receivables has the downside that you
have to discount the face value of the
invoices, but the upside is that you don't
have the risk that some or all of the
invoices will not be paid. So it can be
viewed, for example, as a way to clear unpaid
invoices off the books of an otherwise viable
business.
keywords: Factoring | Invoice Discounting | Accounts Receivables | Accounts Receivable Factoring |
Cash Flow | Bad Debt | Debt Collections
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