Press about us. Factoring for business at OTP Bank Reverse factoring at OTP Bank

The unstable financial situation primarily affects small and medium-sized businesses, whose owners must resort to various financial manipulations to maintain profitable relationships with suppliers. In order not to fall into a debt trap and maintain a reputation, many clients of OTP Bank decide to use a profitable range of services called factoring.

What is factoring?

In simple words, "factoring" is a banking operation in which a financial institution assumes a monetary claim against the debtor, and also collects the debt in favor of the creditor. There are three parties involved in this financial chain:

1. The factor is the banking structure "OTP", which carries out the operation and acts as a communicative link between the debtor and the creditor.
2. Debtor is a buyer.
3. Creditor - supplier of goods (services).

The mechanism of this operation is brought to automaticity. The client of the bank prepares documents confirming the existence of a monetary debt on the part of the debtor. Having accepted and studied the papers provided by the creditor, the bank repays the debt in the redistribution of 80-90%. At the same time, bank employees contact the debtor to discuss the terms of the agreement: during what period will the factor receive back all the credit funds, including commissions.

OTP Bank acts as an intermediary in factoring and, of course, provides its services for a fee. However, the amount of the commission fee is not fixed. The amount of the commission is negotiated individually with the debtor and depends on the scale of the transaction.

Factoring enables clients who are faced with financial difficulties to increase the liquidity of the enterprise, and also has a positive effect on solvency. In addition, this operation is one of the most efficient and profitable ways to solve the problem of lack of working capital.

The creditor, having opted for this operation, must understand that the bank cannot immediately pay the debtor's debt in full. Usually, the payment amount does not exceed 80% of the total debt. Reimbursement of the balance of the debt is carried out after one hundred percent payment of funds by the borrower and receipt of money to the account of the factor bank.

Factoring is an operation, during the implementation of which accompanying legal or insurance services can be provided. Also, one of the advantageous features of factoring is the ability to conclude a financial contract without the participation of guarantors.

To apply for the procedure, the lender must prepare a minimum package of documents: copies of foundation papers; full accounting report; debtor's contact details. From the moment of receipt of the application, OTP Bank controls all stages of the factoring transaction.

Benefits of factoring at OTP Bank

OTP Bank successfully carries out factoring operations on mutually beneficial terms. When signing a cooperation agreement, all the nuances are taken into account. Years of work in this area have been able to bring this service to the highest level, the advantages of which are obvious:

1. Payment of financing up to 90% of the total amount of the transaction.
2. Possibility to defer payment for 180 calendar days, while additionally activating a grace period for waiting for payment for 30 calendar days.
3. Quick review of available limits.
4. The use of exclusively electronic document management, thanks to which the bank can maintain contact with the client in a remote format.
5. A transparent approach to calculating the commission, taking into account the financial capabilities of the client.
6. Ability to manage accounts receivable at the administrative level.

To get detailed advice on factoring, you need to contact one of the branches of OTP Bank. You can choose the nearest branch and get acquainted with its work schedule. Also, if you have any questions, you can call the phone numbers indicated in the table.

It is noteworthy that all factoring transactions are concluded in the national currency: the Russian ruble. And both the debtor and the creditor can initiate the signing of an agreement of this type, since cooperation in this format is often almost the only option to reach a compromise in the shortest possible time.

Factoring from OTP is a unique service that allows you to resolve a difficult financial situation with benefits for all parties: the intermediary bank receives a commission for services; the lender receives the funds as soon as possible; the debtor retains a working reputation and receives a kind of reprieve to resolve difficulties.

This is a type of factoring in which all parties to a sale and purchase transaction are located within Russia.

UniCredit Bank provides:

• recourse factoring with the client's obligation to repay the debt to the bank if it cannot be repaid by the debtor;
• non-recourse factoring without the obligation of such compensation;
• pre-delivery factoring - financing at the stage of ordering goods;
• factoring with increased deferred payment;
• forfaiting is the purchase of long-term payment obligations of the client to the supplier / creditor.

Contact the bank's specialists to find out what package of documents is required to start internal factoring services at UniCredit Bank.

Supplier financing factoring

UniCredit Bank's supplier financing program will help you:

• Strengthen relationships with your supplier network and expect lower procurement costs
• obtain or increase a deferred payment for supplies;
• simplify the chain of interaction with suppliers - you communicate with one bank specialist accompanying your company, and not with a dozen representatives of different suppliers;
• remove part of the work from the accounting department - the bank makes an early payment directly to the supplier's account;
• remove the need to divert working capital to pay for the supply;

How it works?

If you deal with suppliers on a deferred payment basis, this usually means that the supplier includes all costs associated with your receivables in the cost of delivery.

Under the supply financing program, UniCredit Bank buys the right to claim you from your suppliers. For the supplier, this means that they can get cheap financing for your receivables through factoring - instead of covering the cash gap with unprofitable lending at their bank. And for you, this means that you can ask for a lower purchase price from this supplier and give him guarantees for a long-term cooperation.

What's more, your supply chain is significantly reduced, cash flow planning becomes more efficient, and purchasing power grows.

What terms of cooperation can your company expect under the supply financing program? Find out by contacting the bank's specialists or by filling out.

Factoring with recourse

When factoring with recourse, the bank has two sources of repayment of the debt in case of non-payment by the debtor - the buyer and the seller. This reduces the risks taken by the factor, so the bank can expand the range of clients to provide factoring services.

As a client of UniCredit Bank, you can enjoy all the benefits of recourse factoring:

• attract factoring financing in the amount of up to 90% of the total transaction amount;
• get faster and more profitable financing for the period of deferred payment in comparison with lending;
• establish yourself as a reliable partner in working with suppliers, reducing the time for paying invoices for supplies;
• effectively manage accounts receivable and enlist the bank's analytical support in this matter.

Factoring without recourse

The largest Russian and foreign companies are serviced under the non-recourse factoring scheme, in which UniCredit Bank fully assumes the risk of non-payment of the debt by the buyer. Take advantage of a range of non-recourse factoring services to:

• increase liquidity and improve financial performance by writing off receivables from the organization's balance sheet;
• increase purchasing power;
• reduce the amount of working capital;
• improve the ratio of debt to EBITDA.

To find out what conditions for the provision of this service you can expect in our bank, contact UniCredit Bank specialists or fill out.

Factoring with extended grace period

UniCredit Bank allows its factoring clients to receive an additional deferred payment in addition to the contractual one. In this case, the cost of the additional delay is paid by the party acting as a debtor in the transaction.

Pre-delivery factoring

Pre-delivery factoring is financing against the assignment of monetary claims that will arise in the future. This type of factoring is in demand by enterprises that sell and manufacture goods “on order”.

Pre-delivery factoring allows you to:

• refuse to work on prepaid in favor of deferred payment;
• receive immediate financing for future sales of services and goods, as well as for the production of these goods.

This type of factoring requires a deep analysis of the activities of both the seller and the buyer. After the analysis, the bank's expert will make a conclusion about what financing conditions will create the best balance between the bank's risks and the client's needs for factoring financing.

Forfaiting

Forfaiting is a financial service similar to factoring. However, this means that the client receives financing through the purchase of long-term obligations of the debtor to the counterparty (supplier, creditor, etc.)

Forfaiting allows you to:

• discount the total debt in one amount;
• obtain long-term financing for up to 7 years for the purchase of fixed assets;
• transfer the entire risk of non-payment of the debt under the contract to the Bank;

Please contact UniCredit Bank specialists to get more information about forfaiting or fill out.

01.06.2016

Reverse factoring in OTP Bank

Factoring has existed in Russia not so long ago, but today it has already managed to gain a foothold in the product line of many large banks, which focus on the development of transactional products, including factoring. Factoring appeared in OTP Bank at the beginning of 2015. Classic types of factoring are widely used in the arsenal of many Russian banks and factoring companies, therefore, in order to ensure a competitive advantage, OTP Bank, a year later, relied on non-classical (reverse) factoring.

Reverse factoring (for some other factors it is called "purchasing") was developed to attract large buyers and retail chains. If in classical direct factoring the factor (bank / financial agent) enters into an agreement only with the supplier, and buyers only sign a notice and do not bear additional obligations to the factor, except for obligations stipulated by law, then in reverse factoring the client of the factor is just the buyer who attracts factoring of their suppliers. Classical factoring is usually convenient for replenishing the working capital of suppliers, and reverse factoring is for buyers under the transaction. The fact is that classic factoring is not always suitable for suppliers belonging to the segments of medium and small businesses. After all, business has changed a lot over the past ten years, and the conditions on the trade market are often dictated by large wholesale buyers of goods (retail chains). Retail chains and large buyers usually have many suppliers, and many of them due to volumes. production and revenues are simply not interesting for factors to attract to classical factoring. When working on reverse factoring, factors usually enter into agreements with both a large buyer and its supplier, and the agreement with the supplier usually regulates only the form of financing and the amount of commissions. The contract with the buyer, on the contrary, is more extensive and usually includes the procedure for confirming deliveries and the responsibility of the buyer for payment of these confirmed deliveries to the factor. In most cases, factors sign larger contracts with both the supplier and the buyer. These contracts may contain as many conditions and services as the buyer needs for comfortable work with their suppliers, including the provision of an additional delay by the factor in excess of the delay under the supply agreement, for which the buyer usually pays a commission. Reverse factoring differs from classical not only in the number of contracts and the responsibility of the buyer for the fulfillment of claims assigned to the factor, but also in the policy of taking risks on counterparties. If in classical factoring with recourse the factor takes the risk based on the size and financial stability of the supplier, then in reverse factoring, on the contrary,

factor takes the main risk only on the buyer.

It should be noted that the division in terms of risk taking is rather conditional.

character. Many factors now when making suppliers and buyers spend full

risk assessment for both counterparties and set a general limit for each organization under consideration, without being tied to a specific transaction.

In OTP Bank, factoring has existed not so long ago, and at the beginning of this year, the first financing was carried out as part of the Reverse Factoring product. The product diagram looks like the one shown in the picture.

The presented scheme is only the first stage and the first implemented business case for serving one bundle of a large buyer and supplier. In the future, more flexible schemes for paying the factor commission and schemes without providing the buyer with an additional delay will be implemented.

When implementing the implemented case, we performed the following actions:

1. An agreement was signed with the buyer, which indicates:

Regulation of confirmation of receipt of deliveries by the buyer and payment within the agreed time;

The fact of notification of the buyer about the assignment of claims under the terms of the contract (no need for a separate notification, as in classic factoring);

The buyer is responsible for payment for deliveries, invalidity of monetary claims assigned to the factor and trade disputes;

The buyer receives an additional deferment from the bank, for which he pays a commission. At the same time, the buyer is not obliged to open a bank account, since the bank opens special accounts for the buyer, which are used exclusively for repayment of deliveries and commissions.

2. An agreement was signed with the supplier, which indicates:

Conditions for the provision of financing, including sending registers of supplies for financing, signed by the ES, using the Bank's RBS;

Liability for invalidity of assigned deliveries.

When working on reverse factoring with a supplier, the factors usually enter into a simplified

version of the contract, since, although the client of the factor is, in fact, the buyer, financing is still provided to the supplier, so the factor must also have some contractual obligations in relation to the supplier.

At the moment, OTP Bank is implementing more than 40 different options for charging commissions when working on reverse factoring, which differ from each other in terms of collection periods and the object of collection.

Reverse factoring has been a full-fledged member of the pool of factoring products for almost all Russian factors for more than five years and is actively developing, gradually gaining popularity due to large buyers, including retail chains.