Invoice factoring is an ancient practice. Factoring’s roots go back thousands of years. Early forms of factoring were used in ancient civilizations. It became more prominent in the 1300s and 1400s. Factoring continued to evolve with the growth of trade and industry. The practice gained further traction in the 20th century and within industries like

Invoice factoring in 2025 continues to be a significant tool for businesses needing immediate cash flow. Factoring offers a way to sell invoices for cash without relying on traditional loans or waiting for payment terms. This can be especially helpful for small businesses looking to scale operations, improve liquidity, and access capital quickly through invoice

What is Factoring? It’s a whole lot easier to answer this question for business then it is for algebra! Although some people speak to great depths to explain invoice factoring the essence is quite simple. Factoring is a financial transaction where a business owner sells invoices (accounts receivable) to a third party (called a factor).

Factoring is not a loan and there are many differences between getting a bank loan and utilizing factoring. Banks lend money. Most of the time they require some form of collateral which can be challenging for small or new companies. Additionally, banks are limited (by regulation) to how much money they can advance a business