Factoring: a dynamic financial tool in working capital management / Dayang Maimunah Awang Jaya

Tight liquidity is a common problem faced by most firms. Thus, short-term financing will have to be sought to fund working capital. Amongst the short-term financing facilities in Malaysia, factoring is probably the least understood and most ignored. Factoring is essentially a combination of services for it includes administering credit on behalf of the client, maintaining the bookkeeping of client's credit sales, collection of remittances and advancing cash on receivables which are yet to mature.