JD Factors
- Thread starter Jakes
- Start date
I was dealing with my account manager and he charged back a customers invoice. I was told when I started they will not charge back. I spoke to the manager,Tina, and she would not give me my money back. I pay extra for non recourse. Why should I pay extra if there is recourse?
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Always read the fine print. Most factoring companies have full recourse. I have heard that JD Factors offers Non Recourse.
There are many local factoring companies, Grand Finance, Royal Finance, Baron Finance, Factor Bank, Factor Direct, ZZ Finance, Riviera Finance, etc. If you are in Montreal you can try a member on this site. I am sure he will contact you by PM. JD Factors has lost a lot of Market Share in Toronto over the years.
There are many local factoring companies, Grand Finance, Royal Finance, Baron Finance, Factor Bank, Factor Direct, ZZ Finance, Riviera Finance, etc. If you are in Montreal you can try a member on this site. I am sure he will contact you by PM. JD Factors has lost a lot of Market Share in Toronto over the years.
Good, that is helpful. I also received a private message. I will end my contract with JD Factors.
@Jakes, I hate the term non-recourse because it is misleading. All they're really doing is insuring the invoice for credit risk, so there will be no recourse to you if your customer files for bankruptcy. The insurance will not protect you in the event of dispute, which I'm guessing is the case here? If so, I'm pretty sure you'd have the same challenge with any factoring company. If it's not a dispute, please provide more details.
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I have always been perplexed by that term"non-recourse" as well. Who in their right mind would guarantee absolute payment of an invoice, especially an entity with no connection or knowledge of the indebted party? In the case of a bankruptcy, yes there are insurance products available to protect against that loss. On a different note, and this is directed to key factor, we have a recurring, occasional problem with some factoring companies misidentifying our firm. We have received calls requesting payment for past due invoices that do not belong to us, but to another firm with a similar name. We explain the identity mistake but what troubles me is that the factoring company has most probably, as a matter of corporate policy, reported our non payment to various credit agencies resulting in a diminished credit score for our firm. My question to key factor, is what should an innocent company due to ensure that mistakes like this do not adversely effect our credit score? We have requested written confirmation that our name has been removed from the delinquent account, but how can we be sure that this incorrect information hasn't been submitted? Your suggestions are appreciated.
@loaders, much has been written in this forum on reporting inaccuracies with the different credit rating agencies. Only thing I can suggest is to continue doing what you're doing...be vigilant and contact them when there are inaccuracies. Not the answer you were hoping for, I'm sure.
It's a shame that people aren't more careful with documentation. Before buying an invoice, I always try to check that the name of the debtor and amount billed matches exactly what appears on the carrier confirmation and that the BoL is properly signed. I call some of the consignees to make sure there are no disputes. It's lots of work that is unnecessary 90% of the time, but it can avoid headaches for that remaining 10%. A few clients and customers are annoyed by our double-checking, but as soon as there is a dispute - and there inevitably are - they begin to see the merit. They also tend to be the ones that are initially less careful with their documentation, but that too changes over time.
BTW, we don't report to rating agencies as a matter of policy, but sometimes I wish we did!
It's a shame that people aren't more careful with documentation. Before buying an invoice, I always try to check that the name of the debtor and amount billed matches exactly what appears on the carrier confirmation and that the BoL is properly signed. I call some of the consignees to make sure there are no disputes. It's lots of work that is unnecessary 90% of the time, but it can avoid headaches for that remaining 10%. A few clients and customers are annoyed by our double-checking, but as soon as there is a dispute - and there inevitably are - they begin to see the merit. They also tend to be the ones that are initially less careful with their documentation, but that too changes over time.
BTW, we don't report to rating agencies as a matter of policy, but sometimes I wish we did!
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@Jakes, calling it credit-insured factoring is more accurate, but doesn't roll off the tongue and "non-recourse" has a certain ring to it - albeit a misleading one. What they should have said is that there is no recourse ONLY in the event of bankruptcy or protracted payment (ie. a claim can be made once the invoice is more than 60 days past due). We offer this product too, but don't call it "non-recourse".
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My experience the same ht, now that you mention it.. I deal mostly in the US, and it seems to me that the big players, D&S, Apex, and Riviera, have gained market share over the last 5 years. 75% of my carriers who factor use these three. In a way that's good as I now rarely get calls like "sorry we can't do the load becuase our factoring co won't approve you".
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Make sure you read your agreement before terminating. There may be termination fees that influence your decision.
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One more suggestion jakes, make sure the customers you deal with are creditworthy. If the customer doesn't want to pay you, they're not going to pay the factoring company either. Although factoring companies may be more experienced in collections than you might be, a bad credit risk is still a bad credit risk. Factoring companies cannot somehow, miraculously turn a deadbeat customer into a good payer. Taking loads from bad payers and then selling those receivables to factors who don't get paid, will inevitably cause the demise of your business.
Excellent point, Loaders. Factors only make money when we buy invoices, so we try to buy as much as we can unless there are signs that the debtor is not creditworthy or we can't approve a high enough limit. In the second instance, we may ask the debtor to complete a standard credit application and provide us with trade and bank references. Annoying? Maybe a bit... but far less so than being stuck with a deadbeat.
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Some customer are "selective" about who they quickpay. If its a factoring co. you can be pretty much assured they track and maybe report your days to pay..that's their business and what they do. On the other hand if its joe shmoe trucking with one truck.. who cares.. drag him out to 80 days as he likely doesn't keep track that carefully and likely wouldn''t bother to report. Not what I do, but what I suspect alot of people do.. Their core suppliers get the golden glove treatment while the rest get what they get..
