What is the long-chain factoring of Changsha Bank?

The factoring business of banks can be divided into domestic factoring business and foreign factoring business.

The popular point of domestic factoring business will also be called accounts receivable financing, that is, after the company passes the bank's audit, it transfers your accounts receivable to the bank and obtains funds in advance. According to different types, it can be divided into buyout factoring and repurchase factoring. The audit point of factoring bank is mainly to audit the repayment ability of the debtor (that is, the company that owes money to the company).

Foreign factoring business is mainly a financial product designed according to the import and export business of import and export enterprises, and its main function is to let import and export enterprises obtain funds in advance. Specific products include packaged loans, invoice discounts and so on.

In practice, there are many different ways to operate factoring business. Generally, it can be divided into: factoring with recourse and recourse; Explicit factoring and implicit factoring; Discount factoring and maturity factoring

(1) recourse factoring and non-recourse factoring

Recourse factoring means that the supplier transfers the creditor's rights of accounts receivable to the bank (that is, the factor). After the supplier receives the payment, if the buyer refuses to pay or is unable to pay, the factor has the right to recover from the supplier and demand repayment of the prepaid monetary funds. At present, due to the principle of prudence, in order to reduce the possible losses in the future, banks usually provide customers with factoring with recourse.

On the other hand, non-recourse factoring is the risk that the buyer refuses to pay or is unable to pay. After the supplier and the factor carry out the factoring business, it is equivalent to transferring all the risks to the bank. Because the risk is too high, banks generally don't accept it.

(2) Explicit factoring and implicit factoring

Explicit factoring and implicit factoring are distinguished according to whether the factoring business is notified to the buyer.

Explicit factoring means that the supplier should immediately inform the buyer of the factoring situation when the creditor's rights are transferred, and instruct the buyer to pay the goods directly to the factor.

Implicit factoring is to exclude the buyer from the factoring business, and the bank and the supplier conduct factoring business separately. After the expiration, the supplier will come forward to ask for payment and then hand it over to the factor. Suppliers can cover up their poor financial situation through secret agents.

(3) Discount factoring and maturity factoring

Discount factoring, also known as financing factoring, means that when the exporter gives the bill representing the accounts receivable to the factor, the factor immediately provides the exporter with prepayment financing of no more than 80% of the accounts receivable, and the remaining 20% of the accounts receivable is settled after the factor collects all the payment from the debtor (importer). This is a typical factoring method.

Maturity factoring means that the factor does not provide financing to the exporter when receiving the documents submitted by the exporter (such as sales invoices representing accounts receivable), but pays the payment to the exporter after the documents expire. Whether or not payment can be received at that time, the factor must pay the money.