1) Product Overview:
Factoring is the comprehensive financial product that the seller assigns to bank according to the contractual relationship the account receivable generated from the goods sales contract signed with the buyer, and the bank then offers seller the account receivable management, factoring advance payment and credit risk guarantee services based on the account receivable transferred.
2) Product Function/Applicable Target:
1. Customer intending to rely on the account receivable to finance in CCB
2. Customer intending to avoid bad debts risk of account receivable to seek of guarantee on bad debts of account receivable
3. Customer intending to sell account receivable to improve the financial statement
4. Core enterprise intending to assist the upstream supplier for financing to enhance the overall competitiveness of the supply chain.
3) Product Advantage/Feature:
1. Advantage of seller:
· No additional guarantee measures as mortgage, warranty required in principle
· Offer efficient, easy fund financing
· Shorten fund recycle period, accelerate fund turnover and increase enterprise profit
· Rely on the professional capacity of bank to carry out tracking management for buyer and account receivable to facilitate risk control and elevate fund recycle rate
· Beautify enterprise financial statement, lock bad debt loss (no tracking)
2. Advantage of buyer:
· Obtain more favorable payment condition with self-owned reputation and better financial statement
· Simplify the payment formality, reduce settlement expenses
· Facilitate core enterprise to forge and manage supply chain to improve the dependency of upstream and downstream enterprise on it
4) Transaction Condition/Process:
Favorable credit status and financial condition, customer meet the borrower admission requirement of CCB, hold true, valid and undue account receivable, and the buyer of the account receivable meets the requirements of CCB as well, then the domestic factoring business can be applied.