The increasing globalisation of the world’s economy and the demand and supply of capital have impacted how businesses operate in today’s market to leverage and unlock the use of scarce resources. Businesses need capital to sustain and upscale their operations to meet the increasing demand for goods and services. In view of the decentralisation of financing, which is a byproduct of globalisation, new modes of financing for business and trades have emerged. One of such increasing new means of financing is debt factoring. Debt factoring is, simply put, the sale of receivables (debt) by one entity (the “Seller”) due from another party (the “Debtor”) to a third party (related or unrelated) (known as the “Factor” or “Purchaser”) at a discounted price for immediate cash.
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