Do you want to expand your business, but the cash needed to achieve this is tied up in outstanding invoices? Do you want to strengthen your competitive position and offer longer payment terms to customers, without hurting your company’s liquidity and balance sheet?
We understand the importance of an ongoing source of working capital that allows your business to generate growth. We know how to improve your company’s liquidity and provide financing for its operations without incurring debt.
Factoring offered by KUKE Finance can not only give your business a timely cash injection, but also provide supplementary services such as accounts receivable bookkeeping and collection services.
How it works
We agree to purchase your outstanding invoice before its due date falls. In return, subject to the terms of the purchase set out in our agreement with you, we immediately advance up to 90% of that invoice value. The remaining balance, in this case 10% of the invoice value, is available to you after we have received the payment from your customer. The entire process of sending invoice details and keeping track of payments can be managed online through our factoring service system.
In recourse factoring, the factor does not take on the risk of bad debt (non-payment by your customer). This is why it is important that we monitor payments from your buyers during the time period earlier agreed with you, for example 30 days from the due date the an invoice. During this time we conduct collections in order to retrieve money owed to you by your customer (phone calls and letters of reminders). After this period, if your customer still fails to make the payment, you will have to refund the advance or we will reclaim the advance from funds available on your factoring account. Having this in mind, it is crucial to select a proper portfolio of customers subject to recourse factoring. Your buyers should be reliable, have a long-standing, positive history of cooperation and experience only minor payment delays.
- Obtain a reliable source of cash available immediately after issuing an invoice.
- Be more competitive, as you are able to offer longer payment terms to customers without hurting your company’s liquidity.
- Streamline accounts receivable management within your company (save time, optimize trade risk, factor evaluates your buyers’ creditworthiness).
- Compared to non-recourse factoring, recourse factoring involves less formalities dealing with assessing your buyers’ financial standing and issuing credit limits.
Who is eligible
- Companies which sell on credit (defer payment for their buyers).
- Businesses which have a circle of regular customers.
- Companies with annual income exceeding PLN 5 million.
- Businesses which maintain comprehensive accounting.