Factoring, a tool for Trade financing

Tégla, Imre

Farmers and traders of agricultural and food industry products on the domestic and external markets have recently became familiar with a new financial expression. Factoring, as a tool for commercial financing, provides attractive benefits to suppliers, and has now been integrated into state subsidy programs. Yet many people often mistakenly identify factoring with the purchase of overdue receivables, or simply use it to resolve sudden or one-off liquidity problems. But this activity really comes into its own in providing genuine benefits when it is used as a long-term technical solution for financing.

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