Should a company use invoice factoring as a means to manage debt?

To answer this question there must be a clear definition of the company's needs. If the company were seeking exclusively to prevent risk and have cover against outstanding payments, then credit insurance would be the best option.

If the company expects a broader range of services, then, amongst other things, a factor can provide indemnity cover up to 100% of losses. Furthermore the company will not have to fund the indemnity gap provided for in credit insurance.

The factor is an active partner because he operates at all levels of customer account management.

Outstanding payments are at the root of one business failure in four. Factoring helps companies protect themselves against customer risk. The factor works to prevent this and encourage them to "achieve a good turnover". But in the case of a customer's insolvency, the factor undertakes to recover the money owed. Customers are followed up systematically and as a result of their efficiency, factors succeed in reducing by half the number of late payments recorded by companies. Financing debt is not the only service factors offer companies. Factoring is a high-performance mechanism for customer account management.