In ____, the exporter sells accounts receivable without recourse.

Question

Quizplus · Accepted Answer

Factoring involves selling accounts receivable to a third-party (factor) without recourse, meaning the factor assumes the risk of collecting the debt and the exporter is not responsible if the debtor fails to pay. This allows the exporter to receive immediate cash for the receivables and transfer the risk to the factor. Accounts receivable financing and working capital financing may involve recourse, and countertrade is a different type of trade transaction.

In ____, the Exporter Sells Accounts Receivable Without Recourse