Trade & Factoring Services

International Factoring

In international factoring there are usually two factors. The export factor looks at financing the exporter and sales administration (presenting invoices at the right time, collecting payments being the key tasks). The import factor is interested in evaluating the buyer, collecting the money on time at the same time ensuring that he is protected against default.

International factoring encompasses all the four services, that is, pre-payments, sales ledger administration, credit protection and collections.

7 - Step Guide to International Factoring:

1. The importer places the order for purchase of goods with the exporter.
2. The exporter requests the Export Factor for limit approval on the importer. Export Factor in
3. Turn forwards this request to an Import Factor in the Importer's country. The Import Factor
4. Evaluates the Importer and conveys its approval to the Export Factor who in turn conveys
5. Commencement of the Factoring arrangement to the Exporter.
6. The exporter delivers the goods to the importer.
7. Exporter produces the documents to the Export Factor.
8. The Export Factor disburses funds to the Exporter upto the prepayment amount decided and at the
9. Same time the forwards the documents to the Import factor and the Importer.
10. On the due date of the invoice, the Importer pays the Import Factor, who in turn remits this
11. Payment to the Export Factor.
12. The Export Factor applies the received funds to the outstanding amount of the advance against
13. The invoice. The exporter receives the balance payment.

In the international product suite, apart from the existing export-factoring product, we are now poised to launch import factoring as well. That will make us the first and only Bank offering the entire bouquet of factoring products to customers in India.