The present work is a descriptive approach about the activity of factoring companies and your relevance for small and medium businesses. Has for purpose present this segment, as well as their functions, characteristics, advantages offered to the productive sector that visibly finds difficulty in the management of their companies, as well as in the acquisition of working capital. It seeks to clarify in this way, the foundation of its performance in the Brazilian market and also show, through legal aspects, that is an activity that does not resemble the typical activities of financial institutions, and that should not be confused with loan sharks. However, as it presents a less bureaucratic condition for granting credit, and for providing management advisory services, it can be said that factoring companies is a strong alternative for small and medium-sized companies.