Receivable Finance (Factoring)

Factoring is a comprehensive financial package that includes receivables financing, credit protection, sales ledger management and collection.

Receivables Financing
You can mobilize your receivables by turning your capital tied up in receivables into cash at an agreed percentage (usually 80%) of the invoice value

Credit Protection
You can mitigate your buyer risk through the credit protection option. We can offer up to 100% credit cover for your undisputed sales to a wide range of countries and territories.

Sales ledger Management
You can outsource your sales ledger management and collection to us, and we will provide you with the essential receivables information to run your daily business.

Factoring is a modern method of reliable cash flow management, helping to protect and improve your working capital.

If you have one or more concerns in the following checklist, then you should consider Factoring Services.

   Buyer demands O/A to replace prepayment, sight payment, L/C or D/P
   Buyer demands longer payment terms
   Tight working capital due to rapid business growth
   Lack of trading history with a new buyer
   Worried about delayed payments
   Worried about bad debt
   Seek greater financial flexibility

HSBC’s Factoring Services Team is interested in your business and will provide tailor-made solutions based on your unique needs.

Banking in China is easy when you work with HSBC. With over 142 years of continuous presence in China, HSBC is one of the most experienced foreign banks in the country.

Today, with over 30 branches and sub-branches located in key commercial cities in China, HSBC maintains one of the largest branch networks amongst foreign banks in the country, offering a wide range of products and services.

HSBC has major Factoring operations in the UK, France, Hong Kong, Singapore, India, Taiwan, Japan, South Korea, Malaysia, UAE, Australia, New Zealand, etc.

With our extensive expertise around the world coupled with experience in the local marketplace, we bring world-class Factoring Services to you and your trade partners.

1. When is Factoring suitable to our business?
    In general, when you sell on Open Account (O/A), Factoring can be used to support working capital and to     reduce buyer credit risk.

2. How much can I finance after delivery?When will it be credited to my bank account?
    Usually we can finance 80% of the approved invoice value. On request, prepayment shall be credited to your     bank account normally within one to two working days after you present the required documents to the Bank.

3. Do I need to provide collateral for the financing?
    The factored debt is a certain intangible security; collateral is not a must.

4. When will the remaining balance be credited to my bank account?
    After we receive the invoice payment from the buyer or our overseas correspondent factor, the 20% invoice     balance, less charges, will be credited immediately to your factoring account to reduce your outstanding     financing.

5. What does credit protection really mean to me?
    With credit protection, if the buyer delays or defaults payment 90 days (or other number of days agreed     between you and the Bank) after invoice due date and there is no dispute involved, the Bank will pay you the     entire credit-protected amount without recourse.

6. What does Sales Ledger Management really mean to me?
    In addition to providing you with detailed transaction information, Sales Ledger Management services will also     equip you with detailed information to help you analyze outstanding receivables and buyer payment trends.

7. What costs are involved?
    a) Service charge - a fixed percentage of the gross invoice value. This covers credit protection, sales ledger     administration and collection.
    b) Financing interest – for actual financing, charged at rates similar to those of other trade finance facilities
    c) Document handling fee – a flat fee per invoice

Please contact us at the nearest branch or on the phone numbers listed below. We look forward to hearing from you soon.

HSBC Bank (China) Company Limited
Receivable Finance Department, Shanghai Branch
Contact: Ms. Zhang
Tel: 021 - 3888 2356 / 3888 1906
Fax: 021 - 6841 0517
E-mail: factoring@hsbc.com.cn
Add: 3F, HSBC Tower, 1000 Lujiazui Ring Road,
Pudong, Shanghai 200120

Please note:

1.The availability of the export factoring services is subject to regulatory restrictions and HSBC’s own business     consideration, which may change from time to time. The services will be provided pursuant to regulatory     requirements (including, without limitation, foreign exchange regulations).
2.The services are subject to terms and conditions. Please contact us for more details.