FACTORING_Slides

FACTORING_Slides - 1 2 3 . . %ofthefaceamountof theinvoices...

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1. Factoring     Your company will continue to operate and to bill your  customers in the usual way.  Once you begin  factoring  you will send  a copy of the invoices to Factor. Factor will then provide you with a  factoring advance and fund your business 80% of the face amount of  the invoices. 2. Once BTB (Factor) is paid by your customer, the reserved amount of  the factored invoice, (20%), will be released to your company minus  the appropriate financing fee for the time which the advanced funds  were outstanding. 3. The factoring financing fee is based not on the financial strength of  your company but rather on the quality of your customer accounts  and their creditworthiness. The cost is based on the creditworthiness  of your account debtors and the performance of your receivables. The  cash flow factoring fees   can be as low as 2%  of the invoice  amount, depending on the level of risk involved and the amount of  time which the invoice is outstanding.
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1. Invoice factoring, also called accounts receivable finance, or  accounts receivable factoring, is a form of commercial finance 
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This note was uploaded on 11/10/2011 for the course ECON 4260 taught by Professor Victorwakeling during the Fall '11 term at Kennesaw.

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FACTORING_Slides - 1 2 3 . . %ofthefaceamountof theinvoices...

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