Invoice factoring is a way for businesses to get quick, easy access to cash based on the value of their outstanding invoices. For example, if you have $100,000 worth of invoices that haven't been paid yet and you want to use them as collateral for a loan from a factoring company, they'll give you $70,000 in cash up front. The remaining $30,000 will be used as an incentive for the client to pay its debt first before any other creditors receive payments.