Factoring

Factoring is a type of financing that helps businesses manage their working capital requirements by using receivables as assets. Usually, a financier purchases the receivables and provides immediate funds to the business. Here the limit is extended to the Supplier based on the credit worthiness of the Buyer. This helps the Supplier to enjoy highly competitive interest rates.

In factoring, the Supplier submits the pending invoices treated as account receivables on our fintech platform. The digital invoices are shared with the Buyer for approval. Once the Buyer approves the invoices and submit additional documents like GRN, the invoices are shared with Financiers on the platform for bidding.

The Financiers submit discounting offers on the platform. The Seller then selects the best offer and receives funds from the Financier in a single business day. The Buyer is updated with the discounting to update its beneficiary account. Once the credit period is over, the Buyer pays the outstanding amount to the Financier.

Reverse Factoring

Unlike Factoring, where a Supplier wants to finance its receivables, reverse factoring (or supply chain financing) is an invoice discounting solution initiated by the Buyer. Again, it helps manage the working capital requirements of the Supplier and since the process is initiated by the Buyer, the interest applied is less than the one the supplier would have been given had he done it on her own.

In Reverse Factoring, the Buyer submits pending invoices (account receivables) on the Zuron platform. The approved invoices and additional documents like GRN are shared with Financiers on the platform for bidding. The Financiers submit discounting offers on the platform. The Buyer then selects the best offer and the Supplier receives the funds from the Financier in a single business day.

The Buyer is updated with the discounting to update its beneficiary account. Once the credit period is over, the Buyer pays the outstanding amount to the Financier.