Multiple choice

A process by which the receivables of one company or institution are sold to another financial institution is called

  1. factoring

  2. forfaiting

  3. forfeiting

  4. securitising

Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Factoring is a financial service where a business sells its accounts receivable (invoices) to a third party (a factor) at a discount to obtain immediate cash. Forfaiting is similar but typically involves export trade receivables.