I always associated factoring with paying someone to handle Accounts Payable at a big company (which is your customer) with an Accounts Payable dept that is difficult to deal with for a small business (that don&#x27;t have Accounts Receivable). These factoring companies are handed invoices for services rendered and when they collect they give you ~96%.<p>This is different because Shopify is the storefront&#x2F; payment processor, they can collect money when the product is bought; they don&#x27;t have to negotiate with sophisticated people on when the payment can be made. Shopify is fronting the capital before it&#x27;s even been collected, where this is not the case in the typical factoring company&#x27;s business.