Date post: | 15-Jul-2015 |
Category: |
Career |
Upload: | suguna-nadar |
View: | 2,020 times |
Download: | 0 times |
GROUP MEMBERSGROUP MEMBERS
HINU CHAVANHINU CHAVAN
CAJITAN FERNANDESCAJITAN FERNANDES
RANBIR KAURRANBIR KAUR
LINCIA PADULINCIA PADU
VIRAJ THAKKARVIRAJ THAKKAR
0707
1313
2222
3636
5757
CONCEPT OF FACTORING
DEFINITION
The selling of a company's accounts receivable, at a discount, to a factor, who then assumes the credit risk of the account debtors and receives cash as the debtors settle their accounts also called accounts receivable financing.
CHARACTERISTICS OF FACTORING
Money Market Instruments
No Direct Payments
Two types of charges
Margin
FACTORING COMPANIES IN INDIA
Canbank Factors Limited SBI Factors and Commercial Services Pvt. Ltd The Hong kong and Shanghai Banking
Corporation Ltd Foremost Factors Limited Global Trade Finance Limited Export Credit Guarantee Corporation of India
Ltd Citibank NA, India Small Industries Development Bank of India
(SIDBI) Standard Chartered Bank
How Factoring Works
CUSTOMER CLIENT
FACTOR
CREDIT SALE OF GOODS
Invoice
Pays the amount on maturity date
Payment up to 80%
Submit invoice copy
Balance 20% On
Realizations
TYPES OF FACTORING
Recourse Factoring Non Recourse Factoring Invoice Factoring Maturity Factoring Undisclosed Factoring Domestic Factoring International Factoring Guarantee Based Factoring
FUNCTION OF A FACTOR
Instant Cash Speedy Collection Sales ledger administration Credit protection Advisory services
ADVANTAGES
TO THE SELLER
3. LIQUIDITY4. OFF BALANCE SHEET FINANCE5. LEDGER MANAGEMENT6. OTHER ADD ON BENEFIT7. STATEMENTS
TO THE CUSTOMER2. ADEQUATE CREDIT PERIOD3. NO DOCUMENTATION4. PERIODICAL STATEMENT5. COMPANY CAN STRENGTHEN ITS
LINKS6. DOES NOT IMPINGE ON THEIR
RIGHTS
DIFFERENCE BETWEEN
BILL DISCOUNTING & FACTORING
2. TRANSACTION
3. SETTLEMENT
4. NATURE
5. USE
6. SERVICES
7. PROCEDURE