Export factoring or confidential invoice discounting involves the collection of debts by a factoring company on behalf of an exporter often in the debtors language and currency.

Most international factoring or invoice discounting is carried out through a network of factoring and invoice discounting companies. Two common export financing arrangements that factors offer. Collection factoring: the factor pays the exporter, less a commission charge, when receivables are due (or shortly thereafter), regardless of the importer's financial ability to pay. Cash in advance, or discount factoring: the factor issues an advance of funds against the exporter's receivables until money is collected from the importer.

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If your company suffered a £150,000 loss, and your pre-tax margin is 7.5%, you would have to do £2,000,000 in additional sales to break even. Yet accounts receivable is usually the only major asset not routinely safeguarded against catastrophic loss.