Solutions
Most specialty finance companies run more than one structure. Most software makes them run more than one system.
FactorFox is built for the institution that funds. Factors, asset based lenders, purchase order funders, confirming programme operators and freight factors, in North America, Latin America, Europe, Australia and South Africa.
Pick the structure you fund below, or the industry your clients sell into. Each page is written in the vocabulary that structure actually uses, because a page that swaps a keyword into a generic description is worth nothing to somebody who has done this for twenty years.
Why these are separate pages
The differences between funding structures are not cosmetic. They are where the money is lost.
A receivable you bought, a receivable you lent against, a payment you made to a supplier before the goods existed and a payable your client’s buyer approved are four different assets with four different failure modes. They age differently, they dilute differently, they concentrate differently, and each one has a specific week in which somebody discovers the problem.
Four of the pages below are funding structures. Factoring, asset based lending, purchase order funding and reverse factoring. The fifth, freight, is listed alongside them rather than as an industry, because in transportation the debtor, the paperwork, the advance types and the fraud are all different enough that it operates as its own product.
The four industry pages are the same product, applied to a different receivable. What changes is the document that proves the invoice, the reason a payment arrives short, and the question the underwriter should be asking. Healthcare has payer mix and net collectable value. Construction has retainage and lien deadlines. Staffing has a weekly payroll clock. Manufacturing has chargebacks and deductions from buyers large enough to set the terms.
The five books
At a glance
What you fund, what repays you, and what goes wrong.
If you run two of these, this is the table to hand the person who keeps asking why one system cannot just do both.
| Structure | Whose credit repays you | The characteristic loss |
|---|---|---|
| Factoring | The debtor, with recourse to the client where terms allow | Dilution the client did not disclose, a debtor concentration nobody aggregated, and a payment that went to the client |
| Asset based lending | The borrower, secured on a revolving collateral pool | An availability figure resting on stale collateral evidence and ineligible rules nobody could reproduce |
| Purchase order funding | The end buyer, once the goods ship and the invoice is raised | Money paid to a supplier for goods that never shipped, or an instrument that expired while everybody watched production |
| Reverse factoring | The buyer, on a payable they approved themselves | Total concentration on one obligor by design, plus an onboarding queue that stalls until the programme never converts |
| Freight factoring | The broker, at high volume and low value per load | The same load funded twice, an advance against freight that never delivered, and a broker paying the carrier directly |
Industry books
One system underneath
What does not change between structures.
The vocabulary changes on every page. These do not, and they are the reason a mixed book can sit on one platform.
Briefings
Six fixed questions answered against what each person is responsible for, on the web, in Microsoft Teams or on a phone. A second briefing states what moved rather than restating the book.
Evidence
Every conclusion opens onto the records that produced it. Risk observations are append only at the database level, and the platform refuses to show a movement it cannot prove.
Continuous underwriting
Re underwriting on every material event, versioned immutably, with confidence and coverage reported as two separate numbers rather than one comfortable score.
Asymmetric automation
The machine may stop money on its own authority. Only a named human may let it through. Four eyes by default, and certain gates can never be made advisory.
Covenant monitoring
What you owe your own lender, computed continuously with the clause quoted as evidence. FactorFox standards and contractual covenants are never blended into one score.
One book, several structures
A client factoring receivables while a purchase order transaction is in production, under a facility you report on monthly, is one exposure rather than three systems and a spreadsheet.
Where to go next
Come with the structure you actually run.
Bring a schedule, a borrowing base, a stalled purchase order transaction or a confirming programme that is not converting. The demonstration is more useful when it is against your own problem.