Purchase Order Financing Is Based on Customer Credit

March 3, 2010 on 4:49 am | By admin | In Business | Comments Off

The basis on which lenders approve purchase order financing is the strength of credit of the customer that issues the purchase order to the borrower.  To take it one step further, if the customer cannot qualify for accounts receivable insurance, the purchase order financer will not approve the loan request.

But even if credit is strong, financing may still not be approved without some amount of experience between the borrower and customer.  A lender will want to know that the customer has previously received the ordered goods and provided payment to the borrower in a timely fashion more the once.

 

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