If you do not want to manage your receivables yourself, you can assign them to a factoring service provider. The factoring partner takes over the rights to your outgoing invoices and pays you immediately. You pay for pre-financing until the factoring partner receives payment. Factoring can increase your company’s liquidity in the short term, but it only has a positive one-time effect.

Factoring costs money on an ongoing basis. If you can afford it, it may make sense to withdraw from factoring.

Experience shows that you hardly save your accounting department any administrative effort by switching to factoring, because the factoring partner depends on the conscientious preparation of the outgoing invoices and on background information about them.


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