Factoring Funding - Example 1: Foreign Seller to US Buyer
An Italian manufacturer of high quality bedroom furniture sells
container loads to credit worthy U.S. customers (buyers). When we
receive invoices and bills of lading that the goods have been shipped to
the U.S. buyers, we will wire funds to the Italian manufacturer. This
is an example of import/export financing.
Factoring Funding - Example 2: US Seller to Foreign Buyer
A U.S. aircraft aviation parts supplier sells to a Chilean Airline.
Goods are shipped by air and all invoices are covered by credit
insurance. When the Chilean Airline receives the goods, funds are
advanced to the U.S. seller. 60-90 days later the Chilean Airline will
wire funds to the lender. This is an example of an export finance
In almost all international trade finance cases—whether its
import/export financing or an export finance transaction—we will want
the goods sold to foreign buyers to be covered by our export insurance
policy. Coverage on the export policy is usually an additional 1.5% to
the normal factoring charges. (Learn more about Factoring Fees.)
Credit insurance is needed for international transactions due to lenient
financial reporting requirements in foreign countries and the
difficulty of obtaining quality foreign credit information.