Factoring involves at least three parties. On the one side, there is the creditor, an individual or a company who sold goods, rendered a service or performed works for which payment is expected. On the other side, there is a debtor, an individual or a company who has a debt arising from goods purchased, services obtained or works performed. The third party is a bank or factoring company that buys the receivable.

In order for the creditor and the debtor to enter into a factoring arrangement, it is necessary to have a legal basis, which is usually represented by documents such as invoices, contracts or interim certificates. The date when the obligation is due for payment should be clearly indicated on the document.

If you are a creditor and want to collect your receivable earlier, you can apply for factoring, with or without recourse. If you are a debtor and you want us to pay your obligations before the due date in order to obtain some benefit, additional rebate or cash discount, you can apply for reverse factoring.

In addition, if you plan to use factoring services more often, you can also request limit approval. The limit represents the maximum amount of debt with the factoring company, on any grounds.

If you are entering into a business relationship with a factoring company for the first time, in addition to the request for financing, the employees of the factoring company will require you to submit the statutory documentation of your company and financial documentation. If you might be wondering what all this is for, the reason lies in the legislation to which the factoring company is subject.

Based on the submitted documentation, the factoring company employees will analyse your request. First of all, the factoring subject-matter itself is analysed, i.e., the assigned receivable or debt, which must be in accordance with the applicable regulations including in particular the Law on Contracts and Torts and the Law on Factoring. After that, depending on the type of factoring, the creditworthiness of the creditor or debtor or both parties is analysed. When all the procedures of the factoring company are completed, you will be receiving an offer with details about the price, terms, collaterals and other important elements.

If you accept the factoring company's offer, we proceed with the drafting of the contract and other accompanying documents and invite you to sign them as soon as possible. After signing the documents, the factoring company will pay the cash to your account or to the account of another person according to the given instructions.