Factoring – accounts receivable financing
Enhance your company’s working capital turnover ratio and ledger management and manage credit risks with the help of OP’s various factoring solutions.Improve your company’s liquidity
With our factoring solutions, you can increase the predictability of your company’s finances and boost your cash flow.
You can offer longer payment times to your customers
You receive the payments for invoices immediately to your company’s account as soon as goods have been delivered and invoiced.
A diversified package for managing working capital and credit risks
Does your company have a need for a financing service that helps improve working capital management and liquidity as well as allowing you to outsource ledger management?
Sales receivable financing (factoring) is a diversified package for the management of working capital and credit risks. Factoring is ideal for companies engaged in manufacturing and wholesale.
Factoring provides your company with both financing and services. The financing applies to the post-delivery receivables generated based on your company’s established business relations. Invoices assigned to OP are also used as a guarantee for the credit.
Factoring boosts your company's credit control and enables hedging against buyer risk by using credit insurance in Finland as well as abroad. In addition, your company saves money as you do not need to produce services in-house. Therefore, factoring frees resources for your company’s key business areas.
What does OP’s Factoring cover?
The factoring service package includes, for example, the following:
- credit control,
- ledger management,
- reporting,
- debt collection and
- credit insurance service for hedging against buyer risk.
The services improve your company’s liquidity and enable domestic and foreign invoicing within the same credit limit. You can also insure your company’s receivables base in Finland and abroad. Furthermore, you can provide your buyers with customised payment terms and monitor their financial situation.
We create a factoring service package that suits your company’s needs, so that export receivables can also be financed within the same credit limit if necessary. You can monitor financing and ledger information conveniently through our online service on a real-time basis.
Factoring is a good solution for both growth companies and companies looking for a solution for longer payment terms. It also works well for companies in export business.
Sale of accounts receivable
Factoring and the sale of accounts receivable are both quick ways to obtain financing against a company’s sales receivables. The key difference between these two financing solutions is that in factoring, the entrepreneur bears the buyer risk, whereas in the sale of accounts receivable, the risk is transferred to OP.
If your company has a large and established receivables base, the sale of invoices may be the preferred solution for your company. As a solution, the sale of accounts receivable best suits larger companies with international operations, whose net sales exceed 5 million euros.
Your company benefits from the sale of invoices in many ways. In addition to improved liquidity, the arrangement has a positive impact on your company’s capital adequacy and return on capital employed.
The prerequisites for the sale of receivables are that the business relationship between the seller and buyer is established and the creditworthiness of both parties is good. Additional criteria include, for example, uncontested receivables and clear delivery terms.
Please contact your own OP cooperative bank and we will gladly provide more information on suitable factoring options for your company!