How Invoice Factoring Works
Everything you need to know — explained simply.
What Is Invoice Factoring?
Invoice factoring is a financing solution where a business sells its unpaid invoices to a factoring company (like CIMA) at a small discount, in exchange for immediate cash — without waiting 30, 60, or 90 days for customers to pay.
The Simple 3-Step Process
1
You deliver goods or services and issue an invoice to your customer.
2
You submit that invoice to CIMA. We advance up to 90% of the invoice value within 24 hours.
3
Your customer pays CIMA directly on the invoice due date. We release the remaining balance minus a small fee.
Factoring vs. Bank Loan
| Feature | Factoring (CIMA) | Bank Loan |
|---|---|---|
| Approval speed | 24–48 hours | Weeks to months |
| Credit requirement | Based on your customer's credit | Your personal/business credit |
| Debt added | No — you're advancing your own money | Yes — it's a loan |
| Collateral required | Invoices only | Often real estate or assets |
| Contract required | No long-term commitment | Often multi-year |
| Use of funds | Unrestricted | Sometimes restricted |
Who Is Factoring For?
Small businesses that invoice other businesses (B2B).
Companies with slow-paying customers (30–90 day terms).
Businesses that need cash flow to grow, make payroll, or take on new contracts.