There are several Factoring Types, and each Factoring operator also has unique characteristics of completing the transactions. Therefore, if you do not resort to companies specializing in Factoring Credit Management, it may be difficult to compare the various offers.
Despite the various differences between Operators, the main Factoring Types are:
In the case of Non-Recourse Factoring, this means that there is no Recourse onto the Supplier. That is, if the Factoring Transaction has been set to Non-Recource, in case of non-payment by the Buyer, the Supplier does not have to return the amounts that have been advanced.
In the case of Recourse Factoring. As the Factoring operation has been set to Recourse, in case of non-payment by the Buyer, the Supplier must return to the Financier the amounts that have been advanced.
If the Buyer is incorporated in the same Country as the Supplier, this is called Domestic Factoring.
Export Factoring can also be called International Factoring.
This designation comes from the Purchaser being located in a different Country from the Supplier (and probably also in a country other than the Financier).
Another way of classifying Factoring has to do with the relationship of the lender to the buyer.
In Notified Factoring, the Buyer has been informed that Invoices from a particular Supplier must be paid to the Financier.
This type of factoring is unusual because the operating risk is higher. This is because in case of delay or non-payment, the intervention of the funder may already be late.
Other types of Invoice Finance
Know other means of Invoice Financing.
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