This is called Invoice Factoring, sometimes also referred to as Invoice Discounting or Bill Discounting.ĭrip Capital’s Invoice Factoring solution helps bridge the credit gap between small and large enterprises by making it easier for an SME to gain access to export finance without the need of any hard collateral or business financials.
NON RECOURSE INVOICE FACTORING FULL
Once the credit period is reached, the buyer pays the full amount to Drip Capital and you get the remaining 20% minus the factoring fees. In exchange, you get upto 80% of your export invoice value on the day of shipment, rather than waiting for the complete payment from your buyer at the end of the credit period.ĭrip Capital, the factor, takes over the responsibility of collecting payments from your buyers so that you can focus on your business. We can provide you with the type of factoring you need, not the recourse factoring you are being sold.One of the fastest and easiest ways to offset the impact of outstanding account receivables on your cash flow is by selling your export invoices at a discounted rate to a factoring company like Drip Capital. Let Bankers Factoring design you a factoring plan that puts the safest working capital in your pocket. If a company with minimal credit information or a leveraged balance sheet is your biggest client, then having Bankers Factoring take the credit risk might be your key to survival. If you are selling to Walmart then credit is a non-issue, your fears are returns, dilution, and chargebacks. The decision you make about recourse or non-recourse factoring comes down to a few key questions. You know you need credit protection, but is the recourse vs non-recourse invoice factoring argument confusing? Remember there is only one thing worse than no sales and that’s making the sale and NEVER getting paid.Īs a small business owner, you worry about a big customer refusing to pay and 90-day credit terms. Sometimes those hits have been fatal to our client’s business. Sadly, we have noticed through the years, whenever we decline an account debtor (your customer) for credit reasons, and our client sells them without credit protection from us, inevitably, our client takes a hit. Here is an example of Microsoft’s 16-page Vendor Agreement and here is Walmarts Supplier Requirements.
NON RECOURSE INVOICE FACTORING CODE
Terms required by your customer may include insurance requirements, return policies (both known and hidden), duration, shared costs, termination steps, warranty, training, security, business practices, intellectual property, vendor code of conduct, and treatment of confidential information under the account debtor’s vendor agreement and/or purchase order(s).
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If Bankers Factoring does take the credit risk (as defined above), it is important to understand that you are still responsible for the quality and performance of your product or service and for meeting your contractual terms with your customer (the account debtor). Business Owners like how factoring works from Bankers Factoring. When your customer pays the invoice, a color copy of their check and remittance advice loads into our cloud-based reporting system. You also get 24 hour online AR reporting, and our stellar customer service.
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And Bankers Factoring probably buys accounts receivable insurance at a cheaper rate than you could.Īs part of Bankers Factoring Without Recourse Funding, you get an easy-to-understand factor fee, no hidden fees, and unlimited working capital reflected in our non-recourse factoring agreement. You could buy your own credit insurance policy, but the upfront premium for A/R insurance starts from $10,000-20,000. What is Non-Recourse Factoring vs Credit Insurance?