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International Factoring

Overview
The International Factoring is a comprehensive financial instrument that combines cash flow management and credit risk management in cross-border trade. It includes (a) financing granted to the exporter, (b) receivables management, (c) receivables collection, and (d) the buyer's credit guarantee.

Features
Benefits to the exporter
1. The most secure and competitive method of settlement.
2. Investigation of the credit standing of the importer to avoid credit risk.
3. Flexible and convenient financial instrument.
4. Earlier write-off and export tax refund.
5. Collection and settlement of receivables.

Benefits to the importer
1. Higher utilization efficiency of the importer's credit.
2. Payment by credit to minimize the pressure on working capital.
3. Consolidation of cooperation between the buyer and the seller.

Procedures
1. The customer applies to the factor for pre-application for a factoring limit.
2. The factor replies with the approved factoring limit and quotation within 10 working days.
3. The exporter confirms the factoring limit and the quotation and then signs the factoring agreement.
4. The exporter applies to the factor formally for the factoring limit.
5. The factor replies with the final approved factoring limit.
6. The exporter ships the goods and assigns the receivables under the invoice to the factor.
7. The exporter receives the financing funds for up to 80% of the invoice value assigned.
8. The factor collects payment from the importer upon maturity of the invoice and pays to the exporter the received payment minus the interest and other fees. The factor provides 100% indemnity to the exporter for any unpaid funds caused by the importer's bankruptcy or insolvency.

Tips
In accordance with the practices of the international factoring business, the factor is only responsible for the credit risk of the importer. A factor is not liable for the importer's refusal to pay arising from any dispute between the importer and the exporter.

Note: Please contact your local branch for detailed information about the service.

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