The primary difference between invoice financing and invoice factoring is who collects the outstanding invoices. With invoice financing, the invoices are still yours to collect, and the advance you receive is paid back once it is collected (plus fees and interest). With invoice factoring, a factoring company buys your outstanding invoices for a percentage of their value and collects the outstanding payments from your clients. Once paid, you receive the rest of the value of the invoice, minus a service fee.