Glossary

To clarify issues related to receivables and Small and Medium-sized Enterprises

Highlighted terms

d Direct payment

Payment made directly by the buyer to the seller.

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n Notice of assignment

Written communication sent to the Buyer to inform the latter that the account receivables have been assigned and are payable to the Factor.

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m Maturity factoring

A factoring arrangement whereby the Factor pays the supplier the purchase price for the assigned accounts receivables upon expiry...

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c Commission

The amount that the Seller pays the Factor as an administration charge for the assigned receivables.

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t Terms of payment

The terms that determine when the receivables must be paid (e.g. 30 days after the invoice is issued). Typically,...

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c Credit cover

In the case of non-recourse factoring, the Factor assumes the risk of non-payment of some or all the amounts...

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b Buyer

The seller’s customer who must pay the account receivables arising from the supply of goods or the provision of...

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a Acknowledgement

Written confirmation from the Buyer that the assigned receivables are the same as those recorded, that the supply is...

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