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The role of factoring for financing small and medium enterprises (English)

Around the world, factoring is a growing source of external financing for corporations and small and medium-size enterprises (SMEs). What is unique about factoring is that the credit provided by a lender is explicitly linked to the value of a supplier's accounts receivable and not the supplier's overall creditworthiness. Therefore, factoring allows high-risk suppliers to transfer their credit risk to their high-quality buyers. Factoring may be particularly...
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Klapper,Leora.

The role of factoring for financing small and medium enterprises (English). Policy Research working paper series ; no. WPS 3593 Washington, DC: World Bank. http://documents.worldbank.org/curated/en/844291468321884034

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