You have done the work, sent the invoice — and now the client pays in 60 days. Meanwhile rent is due this week. That cash-flow gap is exactly the problem invoice factoring exists to solve.

What is invoice factoring?

Invoice factoring is selling your unpaid invoices to a third party (a "factor") at a small discount, in exchange for most of the money up front — usually 70–90% within a day or two. The factor then collects the full amount from your client on the due date and pays you the remainder, minus its fee.

It is not a loan: you are selling an asset (the invoice) rather than borrowing against it, so it does not add debt to your balance sheet.

For a fuller explanation, see the guide: Invoice Factoring .

How it works, step by step

You invoice the client as normal, with standard payment terms.

You sell the invoice to the factor , which advances you most of its value immediately.

Your client pays the factor on the invoice due date.

The factor pays you the balance , minus a fee — typically 1–5% of the…