Exporters frequently face challenges such as delayed payments and currency volatility, which can hamper their working capital. Factoring provides exporters with a means to convert export receivables into instant liquidity, enabling them to maintain smooth operations and capitalise on new opportunities.
Exporters sell receivables without recourse in export factoring. The factor assumes the risk of non-payment. This protects exporters from bad debts and improves financial predictability.
India’s merchandise exports are projected to surpass $600 billion in 2025, and factoring is becoming a key enabler for exporters to sustain this growth. The Reserve Bank of India (RBI) actively promotes factoring as a tool for export finance, encouraging exporters to adopt this flexible financing option.
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