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A/R Finance & Factoring Terms GLossary

What isInvoice Financing

Invoice Financing is a type of asset-based lending and there are two different types. The 1st type is when the business opens a line of credit leveraging their good accounts receivable as collateral. The 2nd is when the business sells its accounts receivable to an invoice factoring company. When you sell your accounts receivable, either the business or the factor has the options of taking the credit risk.

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