Information on how invoice factoring works.

1
HOW INVOICE FACTORING WORKS
There exist several instances when businesses may
suffer financial losses. These can include
non-payment by users, slump in the stock market,
or even due to bad debts. To recover such lost
funds, businesses can make use of invoice
factoring. Given below is information on how
invoice factoring works
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2
INVOICE SUBMISSION
The user first submits the unpaid invoice to a
third party company who will consider the
eligibility of the submission. Based on further
research on the client/clients in question and
any other credit risks, the company makes a
business transaction with the user.
3
RATE OF ADVANCE
Depending on the users industry, transacted
money or any other risk inducing parameters, the
factoring company pays an initial advance which
varies from 70-98. A notice is sent to the
clients who have caused the payment delay and the
process for payment recovery is set-up.
4
PAYMENT RECOVERY
The factoring company who has assigned the notice
also decides on a particular time period for
payment which could range from 30 to 90 days or
even more. After the company has received
payment, it pays the client the invoice amount
after deducting their fees from it.
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ekring/Coface-globala-kreditfoersaekring