A company sets up its own financing company. Receivables from the sale of goods are transferred to this company. The financing company – takes over the collection of the receivables (debt-collection business), – is liable for the receipt of the payments (del credere assumption; responsibility for doubtful debts) and – and advances the receivables (pre-financing service). – As a rule, the financing company sells the receivables back to a factoring company in order to refinance itself in this way and to hedge against default risks. – See Factoring, Finance company, Ultimo factoring.
Attention: The financial encyclopedia is protected by copyright and may only be used for private purposes without express consent!
University Professor Dr. Gerhard Merk, Dipl.rer.pol., Dipl.rer.oec.
Professor Dr. Eckehard Krah, Dipl.rer.pol.
E-mail address: info@ekrah.com
https://de.wikipedia.org/wiki/Gerhard_Ernst_Merk
https://www.jung-stilling-gesellschaft.de/merk/
https://www.gerhardmerk.de/