1. Factoring refers to the accounts receivable collected from the seller and the buyer when the seller applies to the factoring bank to buy goods on credit. The seller shall be jointly and severally liable for the payment due by the buyer, and shall be liable for the repurchase of accounts receivable at the request of the factoring bank.

2. Simply put, it refers to the seller's behavior of transferring its legally owned accounts receivable to the bank to obtain financing, which can be divided into two types: recourse and non-recourse.