We answer the most common questions about factoring

Factoring is a financial service that lets you collect your receivables from buyers before they fall due. In other words, it lets you shorten the wait for payment of your receivables and get the money you need to develop your business, while the factoring company collects the funds from the debtor when the invoice falls due.

Factoring can be with recourse, where the responsibility for collection remains with you to the end, or without recourse, where the factoring company takes on the responsibility for collection and takes all measures to collect the receivable.

A company with undue receivables from its buyers sells those invoices to a factoring company. The factoring company pays the company the money in advance, less a certain commission.

The benefits of factoring for companies include:

• Faster cash inflow: the company gets the money right away instead of waiting for its buyers to pay.
• Stability: factoring helps to stabilise the company’s cash flow by providing regular cash inflows, even when buyers are slow to pay.
• Reliance on external resources: it is an alternative to traditional credit and bank loans, which can be especially useful for companies with an insufficient credit history or fast business growth.

To find out which factoring option is best for your business, we recommend that you contact our team of financial experts, who will create a model for you that improves the liquidity of your business in the best way.

By using the services of a factoring company you get funds without long procedures and extensive paperwork, within 48 hours. With this way of financing you do not put additional debt on your company; instead, you turn your receivables into working capital, the driver of your further growth and development.

The assignor is a business that assigns to the factor its short-term receivables arising from a contract with the debtor for the sale of goods or the provision of services. The assignor is your company, which obtains funds through the factoring process.

The debtor is a business that owes the assignor money for goods or services it bought. Through the purchase of the receivable, the debtor becomes obliged to make the payment to the factor when it falls due.

The factor is the company that buys, that is, takes over, the short-term receivable from the assignor and collects it from the debtor when the invoice falls due.

The factoring company analyses your company, but also the company that owes you. In this way it establishes whether the business was done or the service performed, whether there is a valid receivable and whether there is the ability to settle it. Companies often use a factoring company’s services even before they start working with a new buyer, because they can get information on the creditworthiness of their new partner.