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.