Factoring

02/07/2018 11:36 AM
Vietcombank provides factoring services on the basis that the sellers assign to Vietcombank all the rights and benefits of receivables arising from sales on credit (except for usance L/C).
Product characteristics
Factoring is a package including basic services:
  • Receivables tracking: Vietcombank tracks receivables for the seller.
  • Advance: Vietcombank advances the seller a proportion (up to 90%) of the receivables value transferred to Vietcombank.
  • Receivables collection: Vietcombank or our import factor collects payment from the buyer on behalf of the seller.
  • Default protection: In case the buyer defaults payment, Vietcombank or our import factor will pay the seller 100% of the receivables value.
Types of factoring 
  • Domestic factoring: Based on domestic sales contracts. In this case, Vietcombank plays the roles of both seller factor and buyer factor to provide all the services.
  • International factoring: Based on foreign sales contracts. In this case, Vietcombank works with an international factor to provide the services.
    • Export factoring: Vietcombank plays the role of an export factor, providing the seller with receivables tracking and advance services; requesting the import factor to provide the seller with collection and default protection.
    • Import factoring: Vietcombank plays the role of an import factor, providing collection and default protection services at the request of the export factor.

Benefits:
a) The seller
  • Expand the business and enhance competitiveness by offering more attractive methods of payment to buyers;
  • Improve cash flow with advance up to 90% of the assigned receivables;
  • Protected against buyer’s default up to 100% of invoice value;
  • Know the buyer’s financial situation, creditworthiness through the assessment of Vietcombank or credible international factors;
  • Save time and money spent in administration and receivables collection.
b) The buyer
  • Get deferred payment terms;
  • Make payment only when the goods are compliant with the sales contract;
  • No factoring fees required;
  • Save fees for international remittances (for international factoring);
  • Flexible payment methods: cash, cheques, transfer, etc.
Vietcombank advances with recourse for the usance receivables arising from commercial contracts with payment methods of T/T, open account or D/A based on the exporter’s factoring facility without guarantees for importer's credit risk.

Benefits:
  • Additional working capital up to 90% of receivables' value;
  • Low cost;
  • Simple and convenient procedures.