1. INTERNATIONAL FINANCE AND FINANCIAL RISK
MANAGEMENT
Presented by -
Shambhavi Singh -94
(FEATURES OF FACTORING)
2. FACTORING
o Factoring is a type finance in which a business would sell its
accounts receivables (invoices) to a third party to meet its
short term liquidity needs.
o Factoring refers to a process where a company sells its
accounts receivable (invoices) to a third party, known as a
factor, at a discount. The factor then assumes the
responsibility of collecting payment from the company's
customers
o Factoring provides the company with immediate cash flow, at
a lower amount than the full value of the invoices, in exchange
for transferring the collection risk to the factor. It's often
used by businesses to improve their cash flow and liquidity.
3. Features of Factoring
Immediate Cash Flow Risk Transfer Reduced
Administrative
Burden
Improved Liquidity
Example :
Freelance graphic
designer
completing a
project
EXAMPLE :
