Turn your open invoices into cash today. Factoring is a financial transaction and a type of debtor finance in which a business sells its accounts receivable (i.e., invoices) to a third party (called a factor) at a discount. . Waiting to get paid is one of the biggest frustrations for many businesses. Companies with seasonal business, lumpy cash-flow or long payment cycles can especially relate. Some customers demand generous terms or are simply slow payers (government and corporate clients come to mind). With factoring, you can turn invoices into working capital that you may use to run your business, expand operations or hire new employees.