'Factoring' is one method of using accounts receivable as security over a loan.This occurs when:

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Factoring is a process in which a financial institution purchases accounts receivable from an entity at a discounted price, usually between 70-90% of the total value. In this process, the institution acquires the right to collect payment directly from the entity's debtors, taking the responsibility for any potential unpaid balances. Therefore, option C is the correct description of factoring. Option A may describe a type of secured lending, but it does not involve factoring. Option B describes a specific type of loan, but it is not factoring. Option D is incorrect as there is a correct option provided.

'Factoring' Is One Method of Using Accounts Receivable as Security