BBI-FSM Factoring vs Forfaiting

POINTS OF DIFFERENCE	FACTORING	FORFAITING
Extent of Finance	Usually 75 – 80% of the value of the invoice	100% of Invoice value
Credit Worthiness	Factor does the credit rating in case of non-recourse factoring transaction	The Forfaiting Bank relies on the creditability of the Avalling Bank.
Services provided	Day-to-day administration of sales and other allied services	No services are provided
Recourse	With or without recourse	Always without recourse
Sales	By Turnover	By Bills