To perform these tasks effectively you will need the following attributes:
The ability to assess a buyer’s credit-worthiness quickly and accurately.
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The ability to collect invoices quickly while maintaining the goodwill of the buyer.
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The ability to remit funds quickly and with full information, so that the EF can allocate them easily.
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The financial strength to meet obligations.
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The ability to prevent or minimise problems and risks. For example, the ability to deal with disputes and to distinguish between real and sham disputes.
The Import factor remuneration
Your remuneration for these tasks is calculated by applying the standardised FCI commission structure which is compulsory for all members. It helps the EF to quote a uniform commission to his export sellers, regardless of the destination countries. The structure has three elements:
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A flat rate, shown as a percentage (%) of the gross turnover, to cover the credit risk.
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A handling charge per invoice or credit note.
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Bank charges.
The IF may charge one, two or three of these items, but may not add any other elements. Chapter 10 of the Communication Manual deals with this in more detail.
The EF may seek to engage your services for reasons other than factoring services. For example, the EF may ask the IF, on behalf of his seller, to help find distributors for the seller’s products or to make a special industry study. The payment for these services cannot be included in the factoring commission and so must be invoiced separately.