Factoring is a financial transaction whereby a business “sells” its “accounts receivables” (i.e. Invoices) at a discount; in order to increase its cash liquidity, project this cash holding on its balance sheet and offset some of the collection process costs and it involves three parties: the seller, the debtor and the factor.

Factoring was underway in England prior to 1400 and it appears to be closely related to early merchant banking activities; nowadays, most of the factors are either owned by, or associated with well-known international banking or other financial institutions, as well as, insurance companies or industrial organizations.

Today, a growing number of companies offer factoring services and many of these operate internationally; factoring is now universally accepted as an answer to the financial needs of medium plus-sized businesses, it has the support of governmental bodies and central banks throughout the world.

Factoring differs from a bank loan in three ways:

1. It is a purchase of an asset (the receivable) and not the provision of a loan;
2. Loan involves two parties (the bank and the lender), whereas factoring involves three;
3. Factoring transactions are based on the value of the receivables and the credit worthiness of the debtor and not on the credit worthiness of the seller

Taking into consideration the global financial crisis, factoring is the ultimate solution against the financial difficulties that the companies, have to face, and overcome.

By outsourcing the credit function, the seller can:

• convert the high fixed cost of operating a credit department into a variable expense, based on sales volumes, (i.e. the factor’s commission).
• improve its financial standing, as the selling of receivables cleans up the balance sheet and improves the financial ratios and consequently offers additional liquidity and enhances the sellers borrowing capability.
• overcome difficulties created by international expansion, such as different customs, currencies, laws and trade regulations

In other words, Factoring is a complete financial package -available to the seller- that combines working capital financing, credit risk protection, accounts receivable bookkeeping and collection services.

According to Factors Chain International (the world’s largest network of factoring companies which counts 242 factors in 64 countries) the global factoring volume was € 1,300bn in 2007 (+14.6% increase from 2006)

The leader of the global market is Europe with a total volume of € 930bn. Within EU market, the most prominent countries are: UK (€ 286bn), Italy (€ 123bn) and France (€ 122bn). Romania and Bulgaria can be considered as emerging and promising markets (+75% and +750% increase from 2006 respectively)

Neurosoft, via its development and introduction of Proxima+, a powerful, flexible and scalable Business Factoring Software Solution; decisively assists Factoring Companies to meet their objectives, cost and time efficiently.

With an industry presence spanning eight years and while working along with business experts; adaptations of new functionalities, within existing and/or new modules of Proxima+, is considered as a continuous on-line process, in order, to cover all present and future needs of Factoring Companies.

Our clients have benefited substantially from our Factoring System which apart from the exceptional processing capacity, offers the added value of our Business Intelligence Platform; a set of specialized services that formulate a total Data Warehouse environment, addressing issues of: Risk Management, Credit Scoring, Reporting, etc.; modules that are incorporated in Proxima+.

Another exceptional aspect of our Factoring System is its multilingual capacity; setting it apart from any Factoring System offered internationally.

Within the continuous R&D process of Proxima+, a new version featuring web based capabilities, utilizing the most advanced Technologies (J2EE, Web Services) is anticipated to be available to our existing and new customers.

This operational platform appeals particularly to the Banking and Finance Institutions that hold a multinational presence or are in the process of establishing such; since the updated version of the product supports: Central Management, Local Control, Multi-Entity, Globally Unified Reporting, Unlimited Scalability, Low Cost Maintenance/Support, Instant Version Upgrades and Global Policy.