What does factoring mean

Factoring is a contractual relationship that exists between a seller, supplier or exporter and a factor.

The term factoring refers to a contractual relationship that exists between a seller, supplier or exporter and a factor. Mainly, the seller assigns its present or future accounts receivable based on the contract for the sale of goods or services concluded between the seller and the buyer to the factor, which provides at least two of the services of trade financing, sales ledger management, accounts receivable collection, credit risk control and bad debt guarantee for the seller.

Domestic concept of commodity trade finance, there are mainly broad and narrow two views: broadly refers to the commercial banks for commodity trading enterprises to provide a variety of financing services, including traditional credit business; narrow concept usually refers to the commodity structured trade finance, that is, commercial banks to the entire trade process as the object of financing, the comprehensive use of a variety of credit tools and security tools, for commodity traders, the trade finance industry, the trade finance industry, the trade finance industry, the trade finance industry, the trade finance industry, the trade finance industry, the trade finance industry, the trade finance industry, the trade finance industry, the trade finance industry, the trade finance industry, the trade finance industry, the trade finance industry, the trade finance industry, the trade finance industry and the trade finance industry. The narrower concept usually refers to structured trade finance for commodities, in which commercial banks take the whole trade process as the financing object and make comprehensive use of various credit instruments and guarantee tools to provide personalized trade finance solutions for commodity traders or production enterprises.

Financial leasing cooperation mode:

1, the bank recommended customers, and provide settlement and other services mode. It refers to the bank to the leasing company to recommend the leasing needs of customers, the leasing company independently to make business decisions, the bank in the leasing receivables collection, capital account supervision to provide services, the two sides can also agree to post-lease management cooperation. This model involves lower risks and is less difficult to implement.

2, the leasing company recommended customers, the bank to help manage the model. It refers to the leasing company and the bank signed a cooperation agreement, the leasing company will be its direct marketing customers, unified to the cooperative bank to open a settlement account, by the bank to provide leasing money collection services, or also provide account supervision and post-lease management services. This model also involves lower risks and is less difficult to implement.

Refer to Baidu Encyclopedia-Factoring for the above