Everyone knows bad loans equals bad credit …..
Some may not know what a NBFC is, but they are a non-deposit taking Non-Bank Financial Institution, engaged in the principal business of factoring. Factoring is used by a seller who sells bills receivables to a third party (called a factoring agency), which pays the seller a major portion of the bills up front and collects the money from the buyer after the credit period is over. It then pays the seller the balance amount.
NBFC-Factors and banks, the Reserve Bank of India (RBI) has clarified that receivables not paid to the former within the due date should be treated as non-performing assets (NPAs). RBI stated The treatment should be uniform and irrespective of the type of NBFC (systemically important or not or deposit taking/holding) and type of transaction – with or without recourse.
The RBI has also mandated that the credit risk taken by a factoring agency on a debtor should be within the limits stipulated by the board of the agency for such underwriting commitments.
Banking regulator further mandates that NBFC-Factors should carry out a thorough credit appraisal of the debtors before entering into any factoring arrangement or prior to establishing lines of credit with the export factor.
Factoring services should be extended in respect of invoices representing genuine trade transactions, the apex bank has said.
RBI has prescribed exchange of information between the concerned banks and NBFCs on factoring limits sanctioned to avoid double financing of the same receivable with the seller deemed to be a borrower.
THANK YOU TO ALL THE TRUCKERS AND REMEMBER TO KEEP ON ROLLIN’
Financial Carrier Services is now offering the lowest rates for freight factoring services, insurance, roadside assistance, and new or used truck warranties. Don’t forget about our no credit check truck financing program as well.
If you’re looking for factoring companies you can rely on, get in touch with Financial Carrier Services today. We want to make sure that trucking companies can stay on the road. When you’re waiting weeks, or even months to be paid on an invoice, our team can help ensure that you get the funds you need! And we make it as simple and straightforward as possible with no contracts to sign, unlimited credit checks so that you can feel comfortable working with certain vendors, and financing options if or when you need it!
We take pride in being able to help trucking companies across the U.S. build their business and have solid finances. If you have any questions about factoring companies, the processes at our company, or how factoring could work for your business, get in touch today!
Reach out through our website or email email@example.com for details!
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