There is nothing complex about factoring or commercial finance. It is simply a unique package of services designed to ease the traditional problems of selling on open account.
The service normally involves a six stage operation.
- You sign a commercial finance contract assigning all agreed receivables to us.
- We then appoint one of our correspondents to act as an import factor in the country where goods are to be shipped;
- At the same time, the import factor investigates the credit standing of the buyer of the exporter's goods and establishes lines of credit. This allows the buyer to place an order on open account terms without opening letters of credit ;
Once the goods have been shipped, you raise your invoice and notify us of the sale and we advance up to 90% of the invoice value;
Once the sale has taken place, the import factor collects the full invoice value at maturity and is responsible for the swift transmission of funds back to us and we then pay you the remaining balance;
- If after 90 days past due date an approved invoice remains unpaid, the import factor will take the risk and ensure that full payment is received by you.