What Is Factoring?

Factoring is a financial product offering financing, guarantee or cash collection services by assigning the invoice-based receivables to factoring companies of the companies which have arisen or to be arisen from goods and services sales. Companies are able to benefit from factoring in both their domestic and international purchases and sales.

Mainly, the factoring transaction is based on,

Factoring Process

Domestic Factoring

The seller company conveys the documents involving information such as the sales terms and trade volume to İş Faktoring.

İş Faktoring presents an offer to the seller after conducting necessary analysis. This offer contains the service type to be provided, the interest rate, commission and fees.

A factoring contract between İş Faktoring and the seller is signed.

Seller informs İş Faktoring in writing about its receivables arisen from goods or service sales.

A copy of the invoice and/or any document verifying the receivable is sent to İş Faktoring or İş Bank branches by the seller.

> İş Faktoring makes an advance payment to the seller pursuant to the mutually agreed rates.

The receivable is paid to İş Faktoring by the debtor on due date.

İş Faktoring pays the balance of the invoice to the seller.

International Factoring

Export Factoring

Buyer forwards the order to the seller.

Seller conveys the information regarding the buyer to İş Faktoring. İş Faktoring forwards this information to the correspondent factor in the related country.

Correspondent factor informs İş Faktoring about the limits and terms determined by them about the credibility of the buyer.

İş Faktoring presents the seller the information obtained from the correspondent and its own working terms.

Following the seller's agreement of the terms, a factoring contract between İş Faktoring and the seller is signed.

Seller and buyer sign a sales contract. Seller sends the invoice related to its goods to the buyer and another copy of this invoice to İş Faktoring.

İş Faktoring makes an advance payment to the seller pursuant to the mutually agreed rates.

On due date, the correspondent factor collects the amount of the invoice from the buyer.

The correspondent factor sends the collected amount to İş Faktoring.

İş Faktoring pays the balance of the invoice to the seller.

International Factoring

Import Factoring

This is a product through which importer companies make their international cash purchases by factoring channel.

At the first stage, a factoring contract between the seller abroad and factoring company is signed.

The buyer sends the invoices of the goods to be imported, their bills of lading and the letter of undertaking to the factoring company.

The payment to the company abroad is made in cash through İş Faktoring.

The importer makes the repayment to İş Faktoring at the maturity date.