The concept

Receivables advance is the operation in which the seller exchanges an amount they would only receive in the future, such as an installment sale or the standard D+3 withdrawal, for money available immediately. In exchange for the early liquidity, the financial institution charges a discount rate, a percentage deducted from the advanced amount.

It makes sense when the cost of the discount rate is lower than the cost of not having cash available to invest in ads or operations in the present moment.

How it shows up in practice

You have a Black Friday promotion coming up and need cash today to invest in ads. Your sales flow brings payout in D+3, which means waiting days with money locked. You offer your payment manager a deal: receive now a smaller amount than you'll receive in the future, in exchange for immediate liquidity.

Your margin is my opportunity.

Jeff Bezos Source: attributed to the author in published interviews and profiles.

The decision comes down to simple math, the discount you pay to advance versus how much you earn by investing that money in ads today. When return on investment in traffic is greater than the cost of discount, advance is worth it.