What Are the Advantages of Factoring?
Factoring offers businesses the means to grow by taking over financing transactions and collection services that would otherwise be costly for management to handle themselves.
Advantageous Solutions for Your Financing Needs
Cash Advantage
With the advance payment from Akdeniz Finans Faktoring, you can pay for raw materials in cash, secure significant discounts, lower your production costs and increase your profit margin.
Competitive Advantage
With fast, high-quality service, Akdeniz Finans Faktoring supports you in offering payment terms to buyers and increasing your competitiveness.
Balance Sheet Advantage
With Akdeniz Finans Faktoring, receivables, inventory and trade payables decrease, and the working capital businesses can generate increases. Your balance sheet becomes more liquid without taking on debt.
Collection
Our company handles the collection of receivables arising from your deferred sales. The records and follow-up of your receivables are carried out by our company. An invoice is issued for the factoring fee, commission and similar expenses accrued by our company.
Less Time, More Cash
Regular cash flow, reduced risk and more effectively managed payments can increase your competitiveness and grow your market share.
Since collection follow-up and receivables management are handled by the factoring company, your business saves time and resources. Operational efficiency increases as the accounting burden is reduced.
A reduced trade receivables balance and shorter collection period contribute to a more liquid and stronger balance sheet structure.
Thanks to intelligence and guarantee services, your trade receivables are managed more securely.
Exporters can enter new foreign markets with more control and lower risk through the guarantee service provided.
The ability to transfer buyer risk to the factor in foreign markets allows businesses to expand into those markets more safely.
Financing used on a non-recourse basis in export transactions may not be reflected as debt on the company's balance sheet, supporting a more liquid balance sheet structure.
Receivables, Collection and Cash Management
A factoring transaction begins with the factor obtaining the following documents from the seller in order to assess the creditworthiness of both seller and buyer.
- The seller's financial statements for the last three years
- Signature circular
- Incorporation gazette
- Trade registry gazette regarding the most recent capital increase
In light of this information, the factor conducts an assessment of the customer and the debtor, and presents the customer with the terms of the factoring agreement to be signed, along with the commission and applicable interest rate. Once agreement is reached with the customer, the factoring agreement is signed, and work begins with the assignment of the seller's receivables to the factor.
Assignment of Receivables and Payment
- The customer assigns its receivables to Akdeniz Finans Faktoring. Collateral relating to the assigned receivables is obtained from the customer.
- It is investigated whether the receivables arose from genuine commercial transactions.
- Akdeniz Finans Faktoring purchases the receivables within the framework of the signed factoring agreement.
- Akdeniz Finans Faktoring makes payment to the customer for the receivables under the prevailing economic conditions.
When the receivable matures, the invoice amount is collected from the buyer company and the process is completed.
What Solutions Does Factoring Offer SMEs?
For SMEs, factoring is an important financing alternative in terms of sustainable growth and regular cash flow. Quickly converting deferred receivables into cash helps businesses access financing more easily and in a timely manner. Thanks to factoring, SMEs can support their working capital, secure their receivables and reduce the time and cost burden created by collection processes.