As factoring does not refer to a credit transaction, it is not included in bank payables section under passive assets on
the balance sheet. Therefore, financial payables section is shown higher than its current state.
The companies would liquidate its deferred receivables without waiting the maturity date by transferring such
receivables to a factoring firm. As the companies would provide customers with the options for maturity, competitive capacity shall increase accordingly.
By receiving discounts on raw material and product purchases through cash advantage, relevant costs shall decrease.
Factoring transactions lead to a change in only active assets section of balance sheet, which increases the payables
turnover rate and decreases the indebtedness rate. Therefore, the ratios shift towards the positive direction.
The companies would obtain necessary funds by means of current commercial receivables.
The agreements and letters of conveyance to be signed with the Factoring Company are exempted from stamp duties.
The companies shall obtain updated information regarding the financial state of customers by periodical reviews.
The transfer of receivables to Factor and the collection follow-up and execution procedures are performed by the
Factoring Company. Accordingly, the enterprises would save the salary of employees assigned to collection procedures.
The enterprises failing to obtain sufficient credit limits from the banks since the enterprises are not allowed to issue
specific guarantees such as client checks or bonds shall finance by transferring the sales amounts invoiced to the
recipients with high credibility to the factoring company.