Factoring companies are firms specializing in factoring business, most of which are funded or established by commercial banks and have independent legal personality. Provide credit analysis and credit evaluation of importers. Accounts receivable collection service. Accounts receivable confirmed by financing. Accounting of accounts receivable.
Precautions for factoring companies:
(1) The buyer (importer) must have a good reputation or credit, and let the import factor verify a certain credit limit for it, otherwise it will not be accepted.
(2) Before continuing the factoring business, and before signing the export contract formally, we should do a lot of work such as application, credit evaluation and credit line verification.
(3) Only after the export factor and the exporter have agreed to handle the factoring business, that is, the export factor has approved the credit line for the importer, can the foreign trade contract be formally signed or the goods be shipped.
(4) Pay attention to the usage of the importer's credit line (balance status) and the changes of its credit status. Always keep effective communication with export agents.