What Is Full-Recourse Factoring?
Recourse factoring – the most common kind of factoring. With a full recourse program, should your customer fail to pay an invoice within the Recourse Period, for any reason, you will be asked to buy back the invoice. Depending upon your advance, this may be accomplished in a few different ways. Our typical recourse period is 90 days. This means that if we cannot collect the full amount of the invoice within the 90-day period, we will charge the invoice back to you. Normally, because we are checking your customer’s credit before funding an invoice, and we are also performing collections, chargebacks for non-payment are not experienced that frequently. A more likely scenario is that your customer “short pays” an invoice. In the event of a short-pay, we will look to recoup the shorted amount via the chargeback process mentioned above.