Which factoring solution to choose

Factoring is a popular financial solution for companies looking to improve their cash management. By assigning their trade receivables to a factoring company, companies obtain a cash advance in exchange for delegating the management of the receivables. Different forms of factoring are available, such as classic, notified unmanaged, confidential, export and reverse factoring. In this article, we'll see that several factoring providers offer services tailored to companies' specific needs.

What is factoring?

Factoring is an increasingly popular financial solution for companies seeking to improve their cash management. This method involves assigning trade receivables to a factoring company, which then collects them in exchange for a cash advance. However, with several options available on the market, it's essential to understand the differences between factoring solutions in order to choose the one that best suits your needs. We'll compare the main factoring options to help you make an informed decision.

What are the different forms of factoring?

Conventional factoring

Traditional factoring offers a complete solution for managing customer receivables. Invoices are assigned to the factoring company, which takes charge of collection, payment follow-up and reminder management. This option offers a cash advance of up to 90% of the value of the assigned invoices. It is suitable for companies of all sizes (VSEs, SMEs, etc.) and in all business sectors.

Unmanaged notified factoring

Notified, unmanaged factoring is a short-term financing solution that enables a company to assign its trade receivables to a factor. However, unlike conventional factoring, the company remains responsible for customer relationship management and debt collection. This implies a higher level of control and monitoring for the assigning company.

Confidential factoring

Confidential factoring is a solution for companies wishing to maintain customer relations without disclosing their use of factoring. Unlike conventional factoring, it does not reveal the involvement of a third party in the collection of receivables. Customers continue to make payments directly to the company, which then reimburses the factor. This option offers greater discretion and helps maintain a relationship of trust with customers.

Export factoring

Export factoring is a financing tool used by companies to secure their international transactions. It enables a company to obtain advance financing by assigning its foreign sales receivables to a factor specialized in export factoring. This method helps companies to reduce payment risks and improve cash flow management in the context of international trade.

Reverse factoring

Reverse factoring is a form of factoring in which suppliers, rather than customers, assign their receivables to a factor. This enables suppliers to obtain advance financing by using outstanding invoices as collateral. Reverse factoring is often used to improve suppliers' cash management and reduce payment times.

What is Dailly factoring?

Dailly financing is a simplified legal mechanism, used in France, which enables a company to assign its trade receivables (unpaid invoices) to a bank or financial institution to obtain rapid liquidity. With cession Dailly, the company transfers its invoices to the financial institution, which immediately advances part of the amount receivable, in return for a commission. This procedure, designed to improve cash flow, is widely used to meet short-term financing needs without cumbersome formalities.

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What are the different factoring solutions?

Karmen Factor:

‍KarmenFactor is Karmen's new financing solution for digital companies, enabling them to preserve their customer relationships, with Karmen Factor, you don't sell your invoice, we finance it for you. As a result, we never interfere with your customer relationship, and remain completely invisible.

Karmen Factor lets you unlock a line of credit tailored to your real needs, so you can draw on it to finance your bills easily and flexibly.

BNP Paribas Factor :‍

BNP Paribas Factor, a subsidiary of BNP Paribas, offers a complete range of factoring services, including classic factoring, confidential factoring and export factoring. BNP Paribas Factor has solid expertise in the management of trade receivables, and offers fast, flexible cash advances.

Société Générale Factoring :

‍Aswith BNP Paribas Factor, Société Générale Factoring is a subsidiary of the Société Générale Group. A major company in the factoring field, it offersfactoring solutionstailored to the specific needs of companies, including classic factoring,export factoring and reverse factoring. Société Générale Factoring also offers risk management and debt collection services to optimize companies' financial management.

Natixis Factor :

‍NatixisFactor is a Natixis subsidiary specializing in factoring and receivables management. It offersflexible factoring solutions to meet companies' needs. Natixis Factor also offers complementary services such ascredit insurance and bad debt management to minimize financial risks.

Eurofactor :

‍Eurofactoris an international factoring company present in several countries. It offersfactoring solutionstailored to small and large companies, covering a variety of industries. Eurofactor offers comprehensive trade receivables management services, including financing, collection and protection against non-payment.

Edebex:

‍Edebexis a Belgian company that offers an online platform enabling companies to sell their unpaid invoices to investors in exchange for immediate cash. Founded in 2013, Edebex aims to solve companies' cash flow problems by offering them the opportunity to convert their receivables into cash quickly and easily.

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In conclusion, factoring is a popular financing solution for companies seeking to optimize their cash flow management. By transferring their trade receivables to specialized companies, companies can obtain a cash advance while delegating the management of receivables. Karmen Factor stands out among factoring companies for its flexibility and speed. By offering tailor-made solutions and constant monitoring, Karmen Factor enables companies to keep their customer relationships in their own hands, while improving their cash flow and financial stability.

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