A factor is an individual or financial institution that buys accounts receivable without recourse.

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This is true. Factors purchase accounts receivable (invoices) from businesses and assume the associated risks and responsibilities, such as collecting payment from the debtor. The factor receives a fee or discount for the purchase of the invoice. The transaction is typically done without recourse, which means the factor assumes responsibility for paying the business for the invoice regardless of whether the debtor pays.

A Factor Is an Individual or Financial Institution That Buys