UNIT THREE - EXAM NOTES
UNIT THREE - EXAM NOTES
Factoring | Forfaiting | Bills Discounting | Leasing | Hire Purchase Complete study notes with real-life examples - prepared from PPT slides
PART ONE: FACTORING
PART ONE: FACTORING
One point one. Meaning and Definition
Factoring is an arrangement between a financial institution (called the Factor) and a business firm (called the Client) where the factor purchases the client's book debts (receivables) - either with or without recourse - and also manages credit administration and sales ledger.
According to Peter M. Biscose: Factoring is a continuing legal relationship between a financial institution (the factor) and a business concern (the client) selling goods or providing services to trade customers.