Few Structures of Factoring 0% 37 If I am a service provider in the KPO (Knowledge Process Outsourcing) segment serving a large American bank, can I get my monthly invoice financed through factoring? Yes All of the above No It depends upon the factor What distinguishes reverse factoring from traditional factoring? Reverse factoring is only available for international transactions Reverse factoring involves a higher interest rate Reverse factoring is initiated by the buyer, while traditional factoring is initiated by the seller How does factoring benefit the buyer in a supply chain? It increases the buyer’s need for working capital It reduces the buyer’s financing costs It extends the buyer’s payment terms with the seller It forces the buyer to pay upfront for goods Why might a seller choose invoice discounting over factoring? To reduce the cost of financing To transfer credit risk to a third party To receive immediate cash for every invoice To maintain control over their customer relationships What is the main advantage of reverse factoring for the buyer? It transfers the risk of non-payment to the factor It enables the buyer to negotiate higher discounts with suppliers It reduces the buyer's overall credit risk It allows the buyer to extend payment terms with suppliers From the seller’s perspective, how does non-recourse factoring benefit their cash flow management? By offering a higher advance rate By transferring the risk of debtor non-payment to the factor By allowing the seller to delay payments to suppliers By eliminating the need for collateral Please enter your name and email address to view the results. Your score is The average score is 55% LinkedIn Facebook Twitter 0%
