WHAT IS INVOICE CONFIDENTIAL INVOICE DISCOUNTING?
Confidential invoice discounting, also known as confidential invoice financing or confidential factoring, is a financial arrangement that allows companies to obtain funding from a lender or factoring company based on the value of their outstanding receivables without their customers' involvement or knowledge.
Many companies prefer confidential invoice discounting or confidential factoring, which is also known as non-notification factoring because it does not require involvement from their customers.
There are several advantages to confidential invoice discounting, including confidentiality. It maintains goodwill with its customers by keeping their financial arrangements confidential from them. It also provides quick access to capital; companies can get funding in a matter of days as opposed to weeks or months.
It also has less strict requirements; unlike bank financing, the focus is primarily on the creditworthiness of the customers rather than just the company's credit and financial condition.
However, in order to keep the transaction confidential from their customers, the company would have to follow up with them on late payments to avoid being contacted by the factoring company or lender.
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