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How is factoring different from a loan, say from a bank?
Author: Charly Applegate
Website: http://www.Cashflow-Answers.com
Added: Fri, Aug 11, 2006 10:39:57
Category: Cash Flow Questions
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Factoring is a loan, although it is different from a loan that is secured from a bank. A factoring company will lend you a percentage of each invoice that it issues. It will then accumulate invoices when they are due and pay the balance back to the issuing company.
On bank loans, there is a fixed maturity and amortization of the amount that you have borrowed. In other words, bank loans are concentrating on lending capital and not on the issuance of your sales invoices.
keywords: Cash Flow | Cashflow | Factoring | Receivables | Loan About the Author:
Charly Applegate answers frequently asked cash flow questions and factoring questions at PrettyGreatAnswers.com.
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