![]() There are also factors that specialize in other industries, so it makes sense to ask when looking for a factor. As a result, some factors specialize in that industry. Factoring is a preferred way of financing within the textile industry, for example. Most factors target specific businesses based upon their volume and the amount of their invoices. There are many independent factoring companies (including online factoring companies) along with many banks that offer factoring services. The factor profits from the difference between the discounted rate negotiated to buy the receivables, and the full amount collected from the customer. ![]() ![]() The factor then “owns” the outstanding invoices and collects from the customers. It is better described as an advance on accounts receivable.Ī “factor” is a third party that purchases part or all of a company’s accounts receivables at a discount. To determine whether or not factoring is the right approach to meet your business needs, it makes sense to understand what factoring is and how it works. What You Need to Know About Invoice Factoring - OnDeck Canada What You Need to Know About Invoice Factoring - OnDeck Canada Arrow Checkmark Quotation Mark API Lightbulb Calendar Chat Chat 2 Chat_5 Check Rounded Square Check Checklist Clock Computer Configuration Customers Document Facebook Australian Flag Canadian Flag US Flag Gear Google+ Hand Heart Hourglass Inventory Laptop LinkedIn Lock Magnifying Glass Mail Mobilephone Money New Download OnDeck OnDeck People Percentage % Person Person 2 Person x2 Phone Phone 2 Play Power Rating Star Resume Rocket Share with Email Share on Linkedin Share on Twitter Shop Speedometer Star Star 2 Star 2 Half Support Telephone Twitter Bi-directional arrow Up Arrow User Wrench Two People Smartbox Search Icon angle-left angle-right comment-o Facebook LinkedIn Share Twitter Close Email Facebook LinkedIn Print Twitter Calendar v2 Arrow Adobe Acrobat Adobe Acrobat Download Bar Graph Battery Book Briefcase Calculator Calendar Cash Cash Decrease Chat Check Badge Check Box Check List Check Mark Clock Closed Lock Coin Coins Desktop Dollar Bill Donut Stat Download Drink Eyeball Filters Gear Glasses Group Headset Heart Heart In Hands Hide Hour Glass Ice Cream Information Information Book Inventory Key Key Hole Knife and Fork Laptop Light Bulb Lightning Lock Magic Magnifying Glass Mail Map Megaphone Mobile Money Decrease Navigation Paper Papers Pen Pencil Percent Person Pie Chart Planet Play Price Tag Rocket Selected Lock Send Share Shield Shopping Bag Speech Speedometer Star Stethoscope Storage Storefront Telephone Text Thumbs Up Two People WarningĪlthough factoring has been around for thousands of years (for example, medieval businessmen and English colonists all used factoring), online invoice factors have made it more accessible to many small businesses looking for quick and simple access to capital to meet business needs.
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