How Reverse Factoring For Your Requirements Now

The service of reverse factoring is in demand on the domestic market, but only on the part of buyers, not sellers. The company offers its clients a full range of factoring services on the most favorable terms.

Smart Factoring Now

This kind of factoring is often called reverse, since the principle of initiation and the mechanism of practical implementation are reversed by the classical one. If in other schemes the initiator of the purchase of the service is the seller of goods or services, in this case their consumer. The main motivation for him is to get a deferred payment or to increase the term of an already valid deferment at the expense of a factor. The reverse factoring options are essential in this case.

The Reverse Version

Reverse or reverse version of the transaction on terms of factoring implies the conclusion of a tripartite agreement, as in the classical version. However, in this case only a non-recurring scheme is provided, since initially the responsibility for payment rests with the buyer and initiator of the factoring service.

  • The company provides any kinds of factoring services at the highest professional level, available to every trustworthy business entity.
  • Delivery agreements with deferred payment (up to 90 days) between the Seller and the Buyer.
  • The buyer notifies the Seller about the transition to factoring services.

Financing of the Seller occurs on the basis of the order of the Buyer, before the expiration of the period of the delay under the supply contract, in the amount of the amount approved by the Buyer for payment

At the end of the period for which funding was provided, the company pays a previously confirmed amount.

The buyer pays the commission on the basis of a separately issued invoice

Usually, the bank factor asks to provide the company’s charter documents, documents confirming the authority of the head of the company, financial statements of the company to make decisions on servicing the client. After making a positive decision with the client, a factoring contract is concluded. Within the framework of the contract, the client provides primary documents (invoices) confirming the fact of the sale of products (the performance of services). Against the submitted documents, the bank provides the client with financing. Next, the bank takes over the management of the customer’s receivables, within which, daily, the customer is informed of the state of the receivables, works on the collection of accounts receivable, the payment due date, etc. After debt repayment by the debtor, the bank retains its remuneration from the payment that comes from the buyer.

Theoretically, for an additional fee, the bank can assume credit risk: in the event of non-return of the debt by the buyer, the supplier will still receive the remainder of the payment. This is factoring without recourse. However, banks take such risks reluctantly, so now only factoring with regress is provided. “Factoring without recourse is more expensive. If customers are confident in their debtors, they have nothing to fear from recourse.

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