Reverse factoring is the buyer-led version of receivables finance: the buyer confirms approved invoices, a financier pays the supplier early at a discount reflecting the buyer’s credit rather than the supplier’s, and the buyer settles with the financier at maturity. The name is used loosely and often interchangeably with supply chain finance and confirmed payables programmes, so it identifies little on its own. What matters is the same set of questions as in factoring — whether the arrangement is disclosed, whether there is recourse, who bears the risk of the buyer’s non-payment — plus, in the buyer’s accounts, whether an extended and financier-intermediated payable remains a trade payable or has become borrowing. That classification question is real and contested.
Why this entry carries no source list. This lexicon cites an official primary source wherever one exists and says so plainly where none does. This term is market convention: it was coined by commercial practice, it is used by everyone in the trade, and no body defines it. Pointing at a carrier’s tariff, a bank’s product page or a trade association’s explainer would dress one participant’s usage as a general rule. The practical upshot runs through the paragraph above — where the word carries no fixed meaning, the contract has to supply one.