Factoring for Legal Entities:

1

Quick access to funds.

2

Financing for ongoing liquidity.

3

Purchase of non-due receivables.

4

Invoice terms of up to 120 days.

Factoring is a product intended for bank’s legal entities, where the factoring bank shall buy any outstanding receivables from a customer (supplier of goods or services) at a discounted value and collect the entire amount through a claim from a buyer (debtor) on the due date of such claim (invoice). Any non-due receivables for the sale of goods or services between legal entities in the country may be purchased (domestic factoring). The purpose of factoring as a product is to finance the ongoing liquidity of legal entities that are clients of the bank. By selling their receivables to the bank, clients will receive the necessary cash they can use to pay their liabilities and purchase working capital.

Unlike short-term loans, for the approval of which the bank shall analyze the full creditworthiness of its client, factoring shall take into account and analyze the quality of the claims that the bank would purchase – due diligence of both the client (supplier) and the debtor (buyer).


The client’s factoring bank shall approve a factoring limit in a certain amount. Within the amount and term of the factoring limit approved, the factoring bank shall be able to purchase invoices upon submission of an individual written request by its client, under the conditions stipulated by the Factoring Limit Agreement and if the required conditions and criteria established by the bank’s credit policy, procedures and other internal regulations are met.

Recourse Factoring (a claim shall be recorded for the debtor and claimed from the debtor up until the due date of the invoice. If the debt is not settled by the due date of the invoice, it shall be transferred over to the client and the entire debt shall be claimed from the client).

  • The first installment shall be paid as an advance of XX% of the total invoice amount, less any discount and commission
  • The remaining amount, in the form of a second payment (the so-called guarantee fund) shall be paid once the invoice debt is settled
  • Following the expiration of the period for invoice payment, the bank shall immediately transfer its exposure based on the invoice of its client’s debtor.

Non-Recourse Factoring (the claim shall be recorded for the debtor and claimed from the debtor up until the invoice debt is settled in full).

  • The first installment shall be paid as an advance of XX% of the total invoice amount, less any discount and commission.
  • The remaining amount, in the form of a second payment (the so-called guarantee fund) shall be paid once the invoice debt is settled.