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Debt Factoring

Debt Factoring is a process of selling your debt to another organisation (by debt assignment) in order that you can receive a 'now' payment for the debt and have the funds which would otherwise be tied up in accounts receivable converted directly into working capital..

By default there are different valuations for the types of debt you are factoring depending on the average age of the debtor, the terms that you are working under and other financial indicators such as security etc.

In order to factor your debt you do not necessarily have to use the assignment clause, however it is preferable to have one in your terms of trade.

Advantages.