Reverse Factoring
Factoring for buyers searching for deferred payment dates
Factoring for buyers searching for deferred payment dates
A commercial transaction is where conflicting interests of the parties often meet as regards payment dates. The Supplier expects the Buyer will pay immediately after delivery, whilst the Buyer wants to defer the payment date and ask the Supplier for the longest trade credit possible. And the financial tool which can support trade credit management on the Buyer’s side is Reverse Factoring.
Product highlights
Under a Reverse Factoring scheme, in accordance with the agreement with the Buyer, Bank Handlowy w Warszawie S.A., operating under the Citi Handlowy brand, takes over the rights of creditor. Accordingly, the Bank repays invoice-documented receivables of the Supplier from the Buyer. Such repayment is made upon the Buyer’s request to the Supplier’s account specified by the Buyer.
Under a single agreement, the Bank provides the following services:
- accepting and processing particular receivables
- evidencing paid receivables
- controlling the process of settlements with suppliers (monitoring payment dates and executing settlements)
- generating repayment reports
- administering the agreement.
Bank Handlowy w Warszawie S.A., operating under the Citi Handlowy brand, provides Reverse Factoring in several variants, depending on the Buyer’s needs:
- Bank may purchase receivables on or before the invoice payment date
- Buyer may pay receivables on the invoice payment date or by a deferred date agreed between the Bank and the Buyer.
The detailed requirements, the terms and conditions of the product and the risks it may generate will be presented to the Client at the sales stage.
Are you interested in our offer?
Please contact your Relationship Manager. Detailed information can be also obtained from:
The cost of the call depends on your local service provider.
Advantages:
- actual payment date of liabilities can be prolonged by enhancing the payment date of liabilities to the Bank
- a discount is available if liabilities to the Supplier are paid earlier
- the liquidity of the Buyer can be improved because the liability payment date is deferred
- Suppliers may grant longer payment dates after Reverse Factoring is presented as the source of financing
- turnovers can increase
- the Supplier is not involved in the transaction (the requires no additional declarations)
- transactions can be executed on an electronic banking platform
- the Buyer may disclose liabilities on the balance sheet as trade liabilities as soon as they are paid by the Bank to the Supplier – the Buyer should confirmed this each time with his auditor
- flexibility – the Bank is ready to perform non-standard agreements, tailored to the Client’s needs