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What is Factoring and how does it work?

Factoring is one of the options that a company should implement as part of its method of collecting accounts.

It operates through a contract by which one company sells the receivables of business activities (invoices) to a third party, so that the latter is responsible for managing the collections of said assets.

When you choose a company specialized in factoring services, they will auction your invoices and then you will receive the amount of the invoice minus a small percentage as a commission for their service.

Factoring is as simple as that!


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