Selling outstanding accounts receivable to a bank offers many advantages, especially in international trade: more financial leeway, higher levels of security and a lower balance sheet total due to a smaller amount of accounts receivable and less borrowed capital.
As flexible as necessary
Any type of accounts receivable can be purchased, such as trade receivables, rent and lease receivables, leasing receivables, and many more.
Accounts receivable may be purchased subject to the possibility of taking recourse to the seller or not, depending on whether the seller is liable for the correctness and collectability of the accounts receivable or just for their correctness.
As secure as possible
When accounts receivable are purchased without the possibility of taking recourse to the seller (forfaiting), the accounts receivable must have been separated from the underlying transactions, for example by means of a letter of credit, a bill of exchange guaranteed by a bank or a bank guarantee accepted by us.
For mere book receivables, a record of acceptance or a confirmation by the debtor to the effect that no objections will be raised on the basis of the underlying transaction is sufficient.
If the default risk is too high for the purchasing bank and none of the above-mentioned collateral is available, accounts receivable can be purchased on the basis of a G9-type federal guarantee or a policy from a private insurer.