Small Business Resource Directory

First-Capital Small Business Factoring Companies

First Capital specializes in asset-based lines of credit, invoice purchasing, accounts receivable management, credit protection, collection services, outsourcing, letters of credit, and international trade services.

First Capital also offers export factoring as an optional addition to traditional domestic factoring clients as well as on a stand alone basis.

Variations of international factoring include, but are not limited to:
Collection only transactions (no credit risk guarantee), Non-Notification business (importer is not notified that the invoice has been factored), Back-to-Back (factoring the U.S. subsidiary/agent of a foreign exporter with assignment of the collected accounts receivable to the foreign bank or exporter).

Services are offered to suppliers seeking:

  • Increase competitiveness by offering open account credit terms
  • Obtain 100% credit risk protection of U.S. / foreign buyer receivables
  • Outsource collection and cash application services for open account sales
  • Finance international accounts receivable (A/R)

  • Services offered to importers seeking:

  • Improve cash flow by obtaining longer trade credit
  • Avoid use of their bank credit line / cash to issue letters of credit or up-front payment to suppliers
    The agreement between First Capital and a foreign exporter under which First Capital provides:

  • Up to 100% guarantee of the importer's credit risk (post-shipment as well as new Pre-Delivery Guarantee - available up to 60 days prior to shipment for 50% of exporter's sale price to importer)
  • Accounts receivable collection service
  • Cash application services (no advances)

  • For foreign exporters (and their lenders) seeking to protect against the insolvency/bankruptcy of U.S. importers prior to the delivery of goods/services, First Capital now offers its Pre-Delivery Guarantee. In the event of the importer's bankruptcy up to 60 days prior to contractual delivery of goods/services, First Capital guarantees 50% of the exporter's sale price. This credit risk protection can be assigned by exporters to their bank to support repayment of any production loans

    Structure / Process

    1. Under the export factoring agreement (with a foreign financial institution or directly with First Capital), the exporter submits importer names and requests a maximum credit limit and payment terms for approval
    2. Invoices are assigned by the exporter to the factor
    3. First Capital receives the assignment either directly from the exporter or by reassignment from the exporter's factor
    4. First Capital collects the accounts receivable at maturity and remits cash to the export factor/exporter
    5. If the importer fails to pay for reasons unrelated to product or performance dispute, First Capital pays up to 100% at 90 days from due date

    This Program is designed for:

  • Foreign exporters seeking to increase sales to U.S. importers by using open account credit terms
  • U.S. sales agents / subsidiaries of foreign exporters
  • U.S. exporters seeking to use open account credit terms as a sales tool

  • Pricing

    Typically, a fee is charged as a percentage on the invoice value plus prime-based interest for accounts receivable financing, if applicable. The fee and interest rate depend on the volume and size of invoices and the credit quality of importers.

    Criteria

    Minimum annual export factoring volume of $1 million
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