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Content ID: PR_WCS01_UCM01057259

Factoring

Management service of collection of accounts receivable, to which may be added cash advances on accounts receivable and credit risk hedging.

Banco BPI | Corporate | Factoring

Banco BPI | Corporate | Factoring

Characteristics

Factoring is a short-term financial solution to support cash flow and collections management through which the company assigns BPI short-term (up to 1 year) receivables of national and/or foreign customers (debtors) resulting from the sale products or services.

Factoring is formalised through a factoring agreement under which BPI provides the following services (according to contractual terms provided agreed with the registered user):

  • Credit collection service and respective specialised management;
  • Advance payment on receivables of Registered User;
  • Credit risk coverage from default of Debtors.

Advance payment is subject to the contractual credit limit and other conditions negotiated.

Factoring in 4 steps:

  1. The company (registered user) invoices the customer (debtor) for the supply of goods or services;
  2. The company assigns invoices to BPI;
  3. At the company’s request, BPI makes advance payment on the assigned invoices;
  4. The customer (debtor) pays BPI for the invoicing of goods or services on the execution date.

Types

  • Recourse factoring: the risk of the operation is assumed by the company (registered user), or rather, BPI does not assume the risk of insolvency of the company’s customers (debtors). BPI has the right to recover advance payments from the registered user in the event of unsuccessful collections from such user’s customers.
  • Non-recourse factoring: when BPI assumes all or part of the risk of debtor insolvency. In the event of non-payment by the debtor, BPI assumes payment of invoices to the Registered User, provided that all contractual requirements are met. 

Advantages

  • Reduction of administrative costs related to the invoice collection process;
  • Reduction of average collection terms, with delivery of process management to a specialised BPI team;
  • Transfer to BPI of collection contacts, preventing any situations that would adversely affect the commercial relationship between the company and its customers;
  • Possibility of advance payment of invoices assigned to BPI, through prior approval of the Factoring credit limit, which may cover customers of the company in part or in full;
  • Improvement of the company’s economic and financial ratios with elimination from the balance sheet (Customers account) of invoices paid in advance by BPI through Non-Recourse Factoring, in which case BPI covers, among others, the risk of customer insolvency;
  • Exemption from stamp duty on credit use (ISUC) in advance payment of invoices under Non-Recourse Factoring;
  • Prior analysis by BPI of existing and potential customers, as well as periodic monitoring of company’s portfolio of customers, mitigating potential risks;
  • Coverage for risk of insolvency of company’s customers (in case of "non-recourse" Factoring).

Beneficiaries

Companies, Sole Proprietors and Self-Employed Professionals.

Amount

Case-by-case analysis.

Term

Up to one year (between the invoice date and execution date thereof).

Conditions

Applicable only in cases of advance payment of invoiced amounts and/or risk coverage of customers. Limit defined for the company and/or sublimits for each customer covered by the contract.


For more information, please go to any BPI Branch or Corporate Centre or contact us.

Observations

This information is provided for advertising purposes and does not constitute a contractual offer; you must read the pre-contractual and contractual information required by law.

Contracting subject to prior approval by the entities involved and subject to the conditions defined according to the risk profile of each operation.

Banco BPI, S.A., Rua Tenente Valadim, 284, Porto, Tied Insurance Intermediary no. 207232431 (registered with the Insurance and Pension Funds Supervision Authority on 31-10-2017 - more details on the registration available at www.asf.com.pt); authorised to carry on insurance business in the Life and Non-Life Branches with the insurers BPI Vida e Pensões - Companhia de Seguros Vida, S.A., Companhia de Seguros Allianz Portugal, S.A. and COSEC - Companhia de Seguro de Créditos, S.A. Banco BPI, S.A. is not authorised to receive premiums or enter into contracts on behalf of COSEC, Allianz or BPI Vida e Pensões and, as an insurance intermediary, assumes no responsibility for the coverage of risks inherent in the insurance contract.