Factoring is a financing option for businesses. With factoring, the business (known as the Client) sells accounts receivable to the Factor in exchange for funding. The Factor typically advances 75% to 80% of the face amount of the accounts to Client. The Factor then collects the accounts from the Client's customers (the Account Debtors) and, upon collection, remits to Client the remaining 20% to 25% of the accounts, less a fee. In addition, the Factor provides various accounts receivable management, collection and credit services to the Client. The following diagram illustrates the factoring process:

Factoring offers the Client numerous benefits. For a description of these benefits, click here. We would be delighted to answer any questions that you may have about factoring. To contact us, please e-mail us at benefactor@benefactor.com or call us, toll free, at (888) 474-3863, or at (303) 333-6111.