What is export factoring?
How about a solution partner that will make it easier for you to trade in a foreign country? Export factoring is a complete financing solution that provides at least one or all of the intelligence, guarantee, collection and financing services to the exporter by taking over the exporter's cash against goods and open account deferred receivables.
How Does It Work? / Export Factoring Process
Export factoring services are provided in two categories, with Correspondent (Two Factor) and Direct (One Factor) options. We provide our guarantee and collection services in international factoring transactions using our extensive correspondent network.
Correspondent (Two-Factor) Export Factoring System;
- The buyer transmits the order to the seller (exporter)
- The seller (exporter) sends the buyer and seller information to the export unit of QNB Finansfaktoring.
- QNB Finansfaktoring transmits the information to the correspondent factoring company in the recipient's country.
- The correspondent factoring company notifies QNB Finansfaktoring of the buyer limit it has allocated.
- QNB Finansfaktoring notifies the seller (exporter) company of the limit and transaction conditions.
- A factoring agreement is signed between the seller company and QNB Finansfaktoring.
- After loading, the invoice is sent to the export department of QNB Finansfaktoring together with the loading documents. Invoice assignment takes place.
- In case the documents are complete, a prepayment is made to the seller (exporter) company.
- When due, the buyer sends the invoice amount to the correspondent accounts and the correspondent sends the amount to the QNB Finansfaktoring accounts. Performs invoice collection.
** The balance payment is made to the seller (exporter) company by deducting the prepayment amount and expenses from the collection from the correspondent. In the event that the exporter does not benefit from the financing service, after the collection is made from the buyer, the remaining amount is transferred to the seller's (exporter) accounts after deducting only the expenses, over the collection amount.
Direct (One Factor)
It is a foreign factoring transaction without a correspondent guarantee. These are the transactions in which QNB Finansfaktoring gives prepayment to the exporter based on the export invoices assigned within the framework of the financing limit established for export companies with high credibility. The buyer abroad will not be aware of this transaction. It is the responsibility of the exporter to close the loan when the transaction is due.
What Are The Advantages?
- Export factoring eliminates the uncertainty of exporting companies regarding the collection of their receivables in the international arena.
- In irrevocable transactions, the credit risk does not appear in the customer's portfolio. With the assignment of receivables, a more liquid balance sheet structure is formed.
- Thanks to reliable intelligence information, it has up-to-date information about the financial strength of the buyer and its credibility in the market.
- Export factoring offers complete export finance advantages in terms of access to finance and collection services.
- After the forward receivables are transferred to the factoring company, a continuous and uninterrupted cash flow cycle is ensured.
- With the prepayment opportunity provided, the seller (exporter) company has the opportunity to obtain the raw material in advance for the products it will produce and provides a discount. With the discount it obtains, it gains an advantage in production costs.
- Since the prepayment will be in foreign currency, they can close their debt commitments and apply for VAT refund.
- Foreign buyer companies do not need to open a letter of credit. They save time and money.
- 3% KKDF (Resource Usage Support Fund) is exempted in factoring transactions.
- Businesses that transfer the responsibility for the collection of forward export invoices will increase their capital and minimize their risk of receivables.