Challenge
An accessory importer had a credit insurance policy in place but could not get its toughest customers credit approved. They required credit coverage that a Factor could provide, but did not want to give up handling collections and check processing.
Solution
Milberg proposed a Non-Notification Factoring Agreement. Milberg handles the credit and underwrites the credit risk, but all payments still go directly to the importer. While similar to credit insurance, Non-Notification Factoring is a far superior solution, as there is no co-pay or deductible When the factor approves an order and a customer cannot pay, the entirety of the loss falls on the Factor.
Result
The importer has far better credit coverage than they ever had before and can utilize Milberg’s skills in ascertaining credit risk, without changing the day-to-day functions of processing customer payments. In addition, the importer doesn’t have to worry about the high cost cost of co-pays and deductibles.
