What is the difference between factoring with recourse and without recourse?

In the case of factoring with recourse, the services provided to the Adherent by the Factor are:

➤ advance payment of a percentage of the invoice value (e.g. 80%);

➤ amicable collection;

➤ and receivables management. The risk of non-payment by the Debtor is borne by the Adherent, and in the event that the Debtor is unable to pay the amount due on the invoice, the Factor has the right of recourse (requests the initially advanced amount, e.g. 80%) against the Adherent at a date after the invoice due date established by the Factoring Agreement. 🧐

In the case of non-recourse factoring services provided to the Adherent by the Factor are:

➤ advance payment of a percentage of the invoice value (e.g. 80%);

➤ insurance of the risk of non-payment by the Debtor (80%-100% of the invoice value);

➤ amicable collection;

➤ and administration of receivables. The Debtor's payment default risk is transferred to the Factor, and in the event that the Debtor is unable to pay the amount related to the invoice due to insolvency or prolonged non-payment, the Factor transfers to the Adherent the insured amount (80-100% of the invoice value) on a date after the invoice due date set by the Factoring Contract. 🙂

❗⠀Important to note: Invoices affected by a commercial dispute are not insured.