MUFG 20YEARS MUFG Finance and Leasing

MUFG 20YEARS MUFG Finance and Leasing

Accounts Receivable Securitization (Factoring)

This is a service that converts accounts receivable to cash early and improves cash flow.

By selling accounts receivable (accounts receivable and bills receivable) to MUFG Finance and Leasing, early conversion to cash is possible. With the WITHOUT-RECOURSE method, assets can be compressed and the balance sheet can be slimmed down simultaneously with execution.

Scheme

Accounts Receivable Liquidation (Factoring) Scheme Diagram. ①For accounts receivable arising between client and client's business partners, client and MUFG Finance and Leasing conclude receivables purchase contract. ②Notification of receivables assignment is made to client's business partners regarding receivables in ①. MUFG Finance and Leasing obtains consent from client's business partners. ③MUFG Finance and Leasing makes lump-sum payment of transfer amount to client. ④Client's business partners make payments of accounts receivable to MUFG Finance and Leasing on due date.

Main schemes handled

WITH-RECOURSE method

If it becomes impossible to collect receivables from the original debtor, the customer bears the obligation to repurchase the receivables from MUFG Finance and Leasing.

WITHOUT-RECOURSE method

MUFG Finance and Leasing bears the risk of receivables collection and the customer has no obligation to repurchase.

Benefits

1. Diversification of financing

By utilizing accounts receivable, diversification of financing is realized.

2. Cash flow improvement

Cash conversion before the collection due date of receivables improves the customer's cash flow.

3. Improvement of financial indicators (WITHOUT-RECOURSE method only)

In the case of the WITHOUT-RECOURSE method, off-balance sheet treatment of accounts receivable is possible as MUFG Finance and Leasing bears the collection risk.

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