What is Factoring?

It is selling your invoices to a factoring company, which then enable you to get cash , and don't have to collect the debt. However, you lose some of the value of the invoice, but the factoring company gets the debt and has to collect it. They make a profit by paying you less cash than the face value of the invoice.
 
You can use factoring to get money quickly, avoid the hassle of collecting bad debt, and smooth your cash flow