Open website’s mobile version Top

Business

Factoring

Factoring

Forecast your cash flow with factoring

  • Quick and easy financing and invoice management
  • Factored receivables are the collateral
  • Credit insurance reduces credit risks

Factoring allows you to offer your clients longer payment deadlines whilst improving your liquidity. Factoring means that you assign the sales invoices you submitted to your buyers to SEB and in return you receive a comprehensive service, which includes invoice financing, invoice management and reducing the credit risk of buyers with credit insurance.

Request an offer

General information

Factoring is suitable for you company if you face the following issues in your business operations:

  • Buyers increase their orders and request longer payment deadlines
    A longer payment deadline can be an important advantage in sales. Factoring allows you to agree in longer payment deadlines with your buyers.
     
  • You cannot use your money because of pending invoices
    Factoring provides you with quick financing. We usually pay the advance part of invoices to your current account on the day we receive the invoice.
     
  • You need extra financing but don’t have suitable collateral
    Your accounts receivable are usually the collateral to the financing if you use factoring.
     
  • Sales management and buyer control are not effective enough
    The invoice management service associated with factoring helps you to save the resources you would otherwise spend on monitoring receipts and constant cash flow planning. Involving a factoring company as a third party may improve the payment discipline of buyers.
     
  • The solvency of buyers is difficult to assess
    Giving payment deadlines to your buyers means that you face the risk of them becoming insolvent. Factoring with credit risk insurance allows you to reduce the credit risk of your foreign buyers. Your excess is generally 10%.

Services offered with factoring

  • Financing
    We usually pay the advance part of receivables to your current account on the day we receive the invoice. This means that you can use the money immediately after the sale and offer longer payment deadlines to your clients.
     
  • Invoice management
    SEB monitors and managers invoice payouts, receipts from buyers and tying receipts to invoices. You will find a detailed report of every payout in Internet Bank for Business.
     
  • Evaluation and reduction of credit risks relating to buyers
    Giving payment deadlines to your buyers always increases the risk that a buyer becomes insolvent by the time the payment deadline arrives. Factoring with credit insurance allows you to reduce this risk.

SEB offers factoring solutions.

  • Factoring is financing of receivables and invoice management. You secure the payment obligation of your buyers to the extent of 100%. You are obliged to buy the invoice on behalf of the buyer if the buyer proves to be insolvent. Receivables from foreign clients are financed only if you have entered into a credit insurance contract.
     
  • Export factoring with credit insurance means financing of receivables from foreign buyers and invoice management with the credit insurance intermediated by SEB. You excess in factoring with credit insurance is 10% of the invoiced amount. We only offer financing and invoice management if you have entered into a credit insurance contract yourself.
     

Factoring contract limit and obligor limit
The total limit of the invoices to be financed (the contract limit) and a separate obligor limit for each buyer are agreed in the factoring contract. The sum of the contract limit and the obligor limit is the amount that the total amount of the receivables financed by SEB and the receivables from one or several obligors may not exceed.

You submit the receivables from all of buyers listed in the contract to SEB. Lack of available contract limit or available obligor limit means that subsequent invoices remain pending until limit is released.

We would like you to include as many buyers as possible in the contract, so we can offer you better factoring terms by reducing risks as the financier.

Standard terms and conditions of factoring
Contract limit at least 13 000 euros
Advance rate 70%–90%
Contract term up to 12 months, can be extended by mutual agreement
Contract fee up to 1% of contract limit, at least 160 euros
Interest rate interest rate depends on the transaction currency, your financial status and the risk level of the transaction
Invoice processing fee 0.1% to 1% of the invoiced amount
The payment term depends on the terms and conditions agreed in the commercial contract.

We advise you to agree in the terms and conditions of the sales transaction with your buyers before you apply for factoring.

Factoring applicants must submit the following documents:

  • application on the form provided by SEB;
  • commercial contracts with the obligors (sales contract, contract for services, etc.), which are the bases for the invoices you would like to be factored;
  • audited annual report for the previous financial year and balance sheet and income statement for the last quarter;
  • additional documents (cash flow forecast, business plan, contracts with important suppliers, etc.) if necessary.

The following documents are required for entry into a factoring contract:

  • passport or ID card of the company’s representative;
  • authorisation document, if necessary.

Once you have entered into a factoring contract with SEB, you must submit the invoices meant for the buyers listed in the contract to us. The sales process and receipt of money take place as follows:

Faktooring - Müügiprotsess ja raha laekumine

  1. You sell goods or provide a service to a buyer listed in the factoring contract.
  2. You have the invoice approved by the buyer.
  3. You send the invoice to SEB.
  4. SEB usually pays the advance part of the invoice to your current account on the same time when SEB received the invoice.
  5. The buyer pays the invoice to SEB.
  6. SEB pays you the difference in the advance part and the amount received from the buyer, withholding the interest due to SEB.

An overview of your factoring transactions is available to you in Internet Bank for Business.

Requirements for factoring invoices
You must send all invoices to be submitted to your buyers, including credit invoices, to SEB. It is important to make sure that

  • your invoices meet the requirements set out in effective legislation;
  • the payment deadline or payment term is noted on the invoice;
  • a note, which advises the buyer that the claim is assigned and must be paid to SEB, is displayed in a visible sport on the invoice;
  • the invoice is approved by the buyer (except export invoices);
  • the documents evidencing transport of goods are enclosed with export invoices and approved by the carrier; and
  • the delivery and acceptance certificate of work or services is enclosed with invoices relating to services. 

SEB offers factoring with credit insurance as a tool that helps to reduce the risks associated primarily with foreign buyers. We have entered into a credit insurance contract with our insurance partner, which allows us to offer you the option to reduce the credit risk of buyers with a factoring contract.

Our insurance partner and we will handle the debt collection if a buyer fails to pay an invoice that was financed with factoring. SEB is the beneficiary in the insurance contract. You don’t have to refund the advance payment your received to us and you only have to pay the fees set out in the contract (interest, handling fee, etc.) and excess.

Insurance does not indemnify for disputed invoices. You have to resolve any disputes with your buyers about the quality of goods and the performance of the sales contract. Making the sales contract as accurate as possible and documenting all communication between the parties makes the resolution of disputes easier.

SEB offers you financing of receivables from foreign buyers similarly to domestic factoring if you have already entered into a valid credit insurance contract. In such a case, you refund the advance payment to SEB if the buyer is in debt and you have to follow the terms and conditions agreed with your insurer in any actions required under the insurance contract.

Valid from 01.12.2018

Description of service Price in euros
General transaction and service fees of Factoring (1)  
Conclusion and/or extension of a factoring agreement Fee as agreed, min €200
Changing the agreement limit Fee as agreed, min €200
Invoice handling fee Fee as agreed
Adding/changing obligor limit (payers without credit insurance)

€25

Adding/changing obligor limit (payers with credit insurance) €30
Changing other terms and conditions of the agreement (excluding changing and/or extending the agreement limit) €65
Preparation of non-standard factoring reports and certificates €30 per hour, min €30

The establisher of the price list reserves the right to make changes to the price list.

(1) Service fees include VAT as per Value-Added Tax Act

Base rates

Valid as 21.06.2019
1-month EURIBOR® -0,3980
3-month EURIBOR® -0,3440
6-month EURIBOR® -0,3080
12-month EURIBOR® -0,2120
EONIA® -0,3680
Bank's base interest 0,0000
EURIBOR® historical data
EONIA® historical data

 

Contact

S|E|B

Tähelepanu! Teie veebilehtiseja ei vasta SEB kodulehe külastamiseks vajalikele nõuetele. Palun vahetage veebilehitsejat või seadet, millega te veebilehte sirvite.

Attention! Your web browser does not correspond to the requirements needed to visit SEB website. Please change web browser or device that you use for browsing the site.

Внимание! Ваш браузер не отвечает требованиям, необходимым для посещения сайта SEB. Просим поменять браузер или устройство, при помощи которого вы производите поиск в браузере.