Let us consider another definition that is connected with credit tips and that is factoring. So in this artcle we will find out what is factoring, what it is for ad also where it can be used.
The factoring is the whole range of services, favorable both for the manufacturer, and for the supplier of raw or partially ready product who lead trading activity on special conditions of a payment adjourning.
Three persons, as a rule, take part in factoring operations: the factor (usual factoring company or savings bank) is a buyer of the requirement, the supplier of any goods – the creditor and the buyer of the goods or in formal – the debtor.
The agreement consists in a progress of the case between factoring company and the supplier in writing about an account presentation-facture on payment of all deliveries of goods.
The factoring company in turn performs discounting of all main and accompanying documents by disposable payment to the client of 60-90 % from cost of requirements in the sum. Thus, equity turnover occurs almost immediately that allows “not freezing” in turn to means for a payment delay.
Advantages of factoring before the traditional credit of bank are visible at once and all is a high-grade possibility to improve turnover results, but also absence of necessity for granting of mortgage provision. During the same moment the factoring is enough expensive functional tool of financing for any business.
The factoring company too for itself levies certain percent from the sum of delivery of the goods, the commission for servicing (too it is necessary to pay for services), and also a small percentage commission for professional document handling. To count up final volume of all expenses always it is very difficult, for it depends on a large quantity of various factors, among them, for example, a delivered goods kind, the country and even reputation of the buyer of the goods.
Factoring services give both middle-specialized factoring companies, and the savings banks which are engaged in constant crediting of any juridical persons. By the way, in factoring especially actively are engaged: the Credit Europe Bank and even known National bank “Trust”.
Some banks at all create the sorted divisions to render to clients corresponding services. Today, as well as was a bit earlier, there are a lot of large factoring companies in our country.
So I hope this information will be useful for you and you will take the full advantage for you from this article.
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