Factoring operations

Factoring is transfer by the economic agents-suppliers of the right to the bank to receive payment on preliminary accepted by payers but not paid payment orders for the goods shipped work performed or services provided under commercial credit conditions. In performing factoring operations the Bank returns to the client not more than 80% of the amount under payment order. Transfer of the outstanding balance to the client occurs once the debt is collected, once the funds are received from the payer.

Before the contract is signed the supplier submits to the Bank the following package of documents:

 

	· duly concluded and signed by the payer sale/purchase contract that of performing works or providing services
	· documents confirming the fact of selling material values, performing of work, providing of services (waybills, copies of warrants, report of acceptance of work…etc.)
	· a copy of payment order issued for the payer and the payer's letter confirming his consent to make payment (to accept) this order
	· balance sheet as of the last reporting date with commence on payable and receivable and with report of checking attached for the whole amount of over due receivable
	· profit and loss account
	· certificate of availability of the fund borrowed from other creditors and availability of free funds, deposited with other banks
	· the list of accounts opened with other banks