Also known as confirming services. A service used to pay suppliers in advance, which is offered by credit institutions. This arises from the long periods of time companies get to pay their bills. In this way the creditors give companies the possibility to have the money before the bills are due.
This payment "in advance" of invoices has a cost, in the form of interest. To do this, the company will have to open a line of credit against confirming beforehand. From there, the company will send the bills to the bank to have them sent to suppliers and they decide whether to cash it beforehand or not, since financial institutions may charge the suppliers fees as well. These services have both advantages and disadvantages.
Advantages: