Only where factorability is present, this facility is suitable. Factorization is not suitable in the following cases :

• where large volume of cash sales take place.
• engaged in speculative business.
• selling highly specialised capital equipments or made-to-order goods.
• where credit period offered to the buyers is more than 180 days.
• where there is Consignment Sale or ‘Sale or Return Arrangements’.
• where sales are to the sister / associated companies .
• where sales are to the public at large, etc.