This would result in a difficult and expensive collections process involving both the bank and the business doing invoice financing with the bank.
Invoice financing does not eliminate all risk, though, since the customer might never pay the invoice.
The lender also limits its risk by not advancing 100% of the invoice amount to the borrowing business. Invoice financing benefits lenders because, unlike extending a line of credit, which may be unsecured and leave little recourse if the business does not repay what it borrows, invoices act as collateral for invoice financing. For comparison’s sake, high volume invoice factoring. Selective invoice finance is sometimes referred to as spot factoring, spot invoice finance or single invoice factoring, in reference to the flexibility of the. Because you can sell as few as one invoice, and you sell invoices on an invoice-by-invoice basis, this type of factoring is also called single invoice factoring. Invoice Financing From the Lender's Perspective Spot factoring is an agreement in which you have complete control over which invoices you sell to a factoring company.
0 kommentar(er)
