More about factoring

Factoring is a versatile financial service that is increasingly being utilised by companies in the industrial, wholesale and service sectors. The three main pillars of factoring are

 

• Liquidity: financing with matching sales
• Security: protection against bad debt losses
• Service: debtor management

1. In the factoring framework agreement, you undertake to assign future receivables to Crédit Agricole Leasing & Factoring S.A. - Branch Germany subject to the condition precedent of sale, while Crédit Agricole Leasing & Factoring S.A. - Branch Germany undertakes to purchase the receivables offered in accordance with the contract.

2. At the beginning of a co-operation and then on an ongoing basis, credit checks are carried out for the debtors and purchase commitments (debtor limits) are issued. The debtor limit corresponds to the maximum amount of receivables for which we assume the default risk.

3. Within the limits granted, your receivables are secured and you can conclude a delivery contract with open payment terms with peace of mind.

4. In the open procedure, you issue the invoice to the customer with an assignment note when you deliver the goods to the destination, informing your customer of the sale of his receivable to Crédit Agricole Leasing & Factoring S.A. - German branch. In the silent procedure, your customer continues to ‘officially’ pay his invoices to you - we remain silent in the background as factor.

5. We purchase the invoices on an ongoing basis within the debtor's limit and generally pay 80 to 90 per cent of the gross invoice value to you immediately. 10 to 20 per cent is retained as security for any invoice deductions (e.g. discounts).

6. As part of receivables management, we monitor your debtors' payments and initiate dunning and collection proceedings if necessary. You can specify the dunning process and the dunning text.

7. The security deposit is credited to you upon payment by the customer or in the case of del credere at the latest 120 days after the due date