What is the typical financing share percentage for a factoring company?

Generally commercial factoring company varies due to factoring business, the financing ratio is roughly between 9% and 16%. Second, the cost and term of the financing of the factoring business The source of financing of the factoring business is the commercial factoring company's own funds, if its own funds are insufficient, the commercial factoring company's financing channels are mainly banks. The benchmark interest rate for short-term bank borrowing is 6.5%. Assuming that the commercial factoring company can finance from the bank at a 7% interest rate, the gross profit margin of the commercial factoring company's factoring business is about 2%-9%, but the commercial factoring company's business cycle is short, the capital utilization rate is high and the factoring business is also charged a fee, so the return is much higher than 2%-9%. Third, the main risk of factoring business The main risk of factoring business in the buyer does not pay, the buyer does not pay the reason can be summarized as three points: 1, trade disputes; 2, the buyer maliciously owed; 3, the buyer is unable to repay. Factoring business most avoid trade disputes, trade disputes need to spend a long time to deal with. Trade disputes are due to the quality of goods, delayed delivery of goods, etc., these disputes allow the buyer to have a legitimate reason to refuse to pay. The two risks of the buyer's malicious default and the buyer's inability to repay are mainly due to the fact that the factoring company does not do a good job of checking the buyer's creditworthiness. How the Internet wealth management side assesses factoring assets will be discussed later. IV. Docking of Factoring Assets and Internet Wealth Management (i) Possibility of Docking Before docking the Internet wealth management end, the return and liquidity of factoring asset investment must be considered. So far, investors invest in factoring assets (in addition to the Internet financial management end) there are two ways: 1) trust; 2) GSE; different industries have different risk of factoring financing, different term, so the return is different, but it is possible to reach a return of about 10%. From the liquidity point of view, the factoring company's accounts receivable are generally less than one year, so docking Internet finance is also very suitable. (ii) Legal Issues From the perspective of risk, return and liquidity factoring assets are suitable for docking with Internet wealth management terminals, but why are there only very few Internet wealth management terminals selling factoring assets? The reason is that the transfer of factored accounts receivable should be registered in the accounts receivable pledge registration system of the People's Bank of China's Credit Center, which creates legal risks for commercial factoring companies to sell assets directly to the Internet wealth management terminal. At present, there is no uniform regulatory approach for commercial factoring companies, and each pilot region has different regulations for commercial factoring companies. Take "Tianjin Commercial Factoring Industry Pilot Management Measures" as an example, Article 14 of which stipulates that "commercial factoring companies should register for the transfer of accounts receivable in the accounts receivable pledge registration publicity system of the People's Bank of China Credit Center and publicize the status of accounts receivable ownership." However, it is not mandatory for the People's Bank of China Credit Center to register the pledge of accounts receivable, which is not required in the management methods of some other pilot regions. In order to comply with the law, commercial factoring companies can take the following three ways to dock the Internet wealth management: 1, by the Internet wealth management end of the company to set up an asset management company as a factoring company to avoid illegal fund-raising, used to take over the right to income of factored assets; 2, similar to the practice of some P2P platforms, the right to income of the factored assets will be transferred to a certain individual, and then transferred to the Internet wealth management end. 3, the Internet wealth management end of the establishment of a commercial factoring company to accept the right to income from the assets of other commercial factoring companies. To summarize, there are three core points in the wind control of factoring business: the authenticity of accounts receivable and underlying trade, the validity of factoring business information, and the operating ability of the creditor enterprise. Among them, the first one can cross-verify the authenticity of the underlying trade through the procurement contract, trade documents, in and out warehouse records, payment receipt and other materials; the second one can guarantee the authenticity of the factoring business through the authenticity of the confirmation of accounts receivable, the registration agreement of accounts receivable transfer, the registration record of Zhongdeng.com, etc.; and the third one is mainly through the way of confirming the financial data, the investigation of the negative information, and the on-the-spot due diligence research. The third is to confirm the financing needs and repayment ability of the creditor and debtor enterprises through financial data, negative information investigation and on-site due diligence research. Through the above, we can understand that what is the general share ratio of factoring company financing is in accordance with the changes in the factoring business, generally between 9% and 16%. In addition, the financing of the factoring business also has a certain cost and period, we should pay careful attention and not exceed.