Commercial Discount
Commercial discount is a facility that allows a company to finance its accounts receivable by having its trade bills bought back before maturity, for a fee. It is a facility that allows the company to receive immediate payment on a bill due.
Advantages
- It allows you to mobilize your customer receivables more quickly and to finance yourself at a competitive cost.
- Discounted customer receivables are not recorded on the company's balance sheet in the case of non-recourse discounts.
Characteristics
Company with Turnover <= 1 Billion XOF
Maximum Amount (million XOF) |
Bills submitted for discount, minimum 5 Million XOF excl. tax |
Duration |
12 months |
Interest Rate (excl. tax) |
From TBB +1 to TBB + 2.5 |
Documentation
For setting up the facility
- Client request
- Headquarters location plan
- Manager's CV
- BIC form
- Solvency report to be requested from the BIC
- Heritage form
- Visa financial statements
- Cash flow plan
- List of drawees concerned by the requested facility
- Commitment point
- Statutory Auditors Report (if legally required)
- Copy of the ID card of the spouse if married under community property or proof if married under separation of property
For each use of the facility
- Trade bill submission form
- Copy of the domicile notice
- Delivery order or work acceptance report
- Invoice
- Purchase order (In the absence of a delivery order and an invoice)
Company with Turnover > 1 Billion XOF
- Rate: 6 to 14% (excl. tax)
- Duration: 6 to 12 months, renewable
- Amount: Based on the bill
- Repayment: Outstanding at maturity for the bill, interest from the setup
- Documents to be provided:
- Domiciliation notice
- The trade bill
- Ensure the existence of a real commercial relationship between the drawee and the assignor (commercial information, ...)
- Guarantees: For discounting, the guarantee is intrinsic (no guarantee to be taken because the risk is related to the quality of the drawees)