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International Factoring
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In international trade, when the exporter sells goods or provide services to importer on credit, such as O/A or D/A, the exporter's factor and importer's factor will provide a series of financial services jointly, including commercial credit investigation, collection and management of account receivable, factor's finance, credit risk control and bad loan guarantee. That is international factoring.
Our bank will provide as exporter's factor the service of trade finance, management of sales accounts, collection of account receivable as well as bad loan guarantee within certain credit line of the importer's factor; we also provide as importer's factor the services of credit risk control and bad loan guarantee. - Benefits of Factoring to Importer and Exporter
| Benefits | To Exporter | To importer | | Expand business volume | Offer more competitive payment conditions for the buyer, such as O/A, D/A, be helpful to expand market and sales volume | Receive more preferential payment conditions, reduce financial pressure, speed up cash flow and expand business volume | | Provide risk insurance | Within the range of a certain limit, the credit risk of the importer is taken by the factor.
Improve the quality of the account receivable
| Acquire credit line by reputation and financial performance of the company
No need to offer guarantee
| | Save costs | The costs for credit investigation and account management as well as receivable collection are born by the factor.
Reduce the burden of the company and save management costs
| Save the cost and time for opening letter of credit and handling with complicated documentation | | Simplify procedure | Save the complicated procedure for letter of credit settlement | Be granted with the credit line
simplified procedure for purchase and more convenient store of goods | | Increase profit | With expansion of export volume, save management cost.
The risk is undertaken by the factor
Increase of profit
| Speed up flow of cash and goods
Expand business volume
Increase profit
| - Application Subject and Trade Background
If you company need the service of international factoring, you must satisfy the following conditions:
(1) The exporter or importer should be registered under the approval of industrial and commercial administrative departments and acquire business license of enterprise legal entity after annual inspection and the permission for production or business operation. It should have the license for import and export business and comply with the state regulation on foreign exchange purchase and sales and on the declaration of international payments.
(2) Your company is an independent accounting unit and has complete financial and accounting system.
(3) Your company maintains foreign currency account with our bank and have international settlement transactions.
(4) In export factoring business, the exporter should have strong capability in business operation and performance as well as fine condition of cash flow.
(5) The two parties of international trade are not affiliated company or the head office of the bank approves the deal for special conditions.
(6) Meanwhile the trade background should satisfy the following requirement.
(7) True trade background.
(8) Principally the debt should come from the sales of independent commodity or service, such as production materials, product parts or consumer goods.
(9) The commodity should have good market and do not easily lead to commercial disputes.
(10) There are no special terms of the trade contract or related laws or regulations, which restrict or prohibit the transfer of the debt.
(11) The trade deal is not related to any illegal or unfair trade business. - Application Procedure
(1) Export factoring
You should fill in the application form for factoring business and provide us with the copy of business license, permission and materials about the foreign importer and sign the export factoring agreement with our bank.
(2) Import factoring
You should provide the detailed introduction of the supplier and the transaction and sign the import factoring agreement with our bank. | | | | | | | | |
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