What is Accounts Receivable Financing?Accounts receivable financing means short-term funding that a business can draw on using its receivables. It is beneficial if a timing mismatch exists between the cash inflows and outflows of the business. AR financing can take various forms, but the three major types are:
- Accounts receivable loans
- Factoring
- Asset-backed securities
- Creditworthiness of the debtor
- Duration of receivables
- Industry of the original account
- Quality of documentation
Evita Veigas
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