Invoice trading is a means of borrowing money, wherein a business will obtain funds from investors using unpaid or overdue invoices. The invoices will act as a guarantee of payment. This finance option is facilitated by invoice trading platforms, which allow companies to sell invoices to online investors.
An invoice trading platform connects companies with cash flow issues with investors seeking short term investments. Because of this, invoice trading is often referred to as peer-to-peer lending, as well as invoice finance and invoice discounting.
Benefits of invoice trading