It is a financing method whereby companies obtain funding by assigning their domestic, invoice-based receivables arising from deferred payment sales to a factoring company. This service covers the purchase and collection of receivables arising or to arise from the sale of goods and services based on invoices and similar documents by the factoring company. Through this process, companies can better manage and stabilize their cash flows.
Under export factoring, receivables arising from export sales of goods or services on an open account basis are assigned, and the seller is provided with guarantee, collection, and financing (prepayment) services prior to the invoice maturity date.
Import factoring enables domestic companies to pay their import-related liabilities on deferred terms. At the same time, foreign exporters benefit from guarantee, financing, and collection services for their sales.