What is electronic factoring and why can it boost my company’s finances?

Electronic factoring is a tool that gained strength in Colombia with the implementation of the electronic invoice. Here we tell you why this is an opportunity to add liquidity to your company’s capital and facilitate traceability and transparency in the purchase and sale movements of your business.

With the advent of  new digital reorganization technologies  for companies, such as  electronic invoicesblockchain  or  big data , the door was also opened for  electronic factoring  to become a reality in the country’s business sector.

Electronic factoring is a  short-term financing mechanism , by a financial institution, which advances the payment of a receivable invoice.

In short, the company issuing the invoice  receives the money in advance, in exchange for assigning the credit  (an electronic invoice receivable) to a third party. The latter must pay the balance in an almost immediate term, assuming a discounted percentage, for the factoring service.

Factoring is an opportunity to achieve  greater liquidity , since it allows you to collect in advance those invoices that have a due date of 60 or 90 days.

Who participates in the factoring process?

  • Client or issuer:  is the first legitimate holder of the invoice, who generates a charge for the sale and who wishes to obtain liquidity.
  • Payer, receiver or acquirer:  is the person who received the good or service from the issuer and, therefore, must pay the invoice.
  • Factor or buyer:  it is the financial entity or the third party that negotiates and buys the electronic invoice from the issuer at a discount rate and who will later charge the payer for the total amount of the invoice.

It is important to mention that the authorities that dictate, monitor and administer the country’s tax control also interact in this process   . In the case of Colombia, the  DIAN.

In Colombia, the DIAN is the entity in charge of registering electronic invoices and guaranteeing that the information they contain is legitimate.

The most common types of electronic factoring:

  • Non-recourse factoring:  the factor assumes the risk of non-payment of the payer.
  • Factoring with recourse:  the issuer is responsible for the risk of insolvency of the payer.
  • Factoring with notification:  the factor notifies the payer of the assignment of the invoice and, therefore, the payer will be obliged to cancel the factor, according to the conditions.
  • Factoring without notification : the payer, not having information about the negotiation of the invoice, pays the issuer. In this case, the issuer can be appointed collection agent.

5 advantages for your company if you implement electronic factoring:

Improves  the financing capacity  of the business .
Verify the  validity of an electronic invoice  .
Reduces the risk of fraud, since it offers  greater security  in the exchange of information.
Streamline and  optimize the payment process  in your company.
Reduces costs , because the use of paper and the use of physical spaces for filing are reduced.

Is electronic factoring already implemented in Colombia?

Sí, el Gobierno Nacional reglamentó con el decreto 1154 de 2020 que la factura electrónica puede negociarse y tratarse con la naturaleza jurídica que tiene un título valor, facilitando su circulación en el territorio nacional.

La DIAN garantiza la consulta, trazabilidad y unicidad de estos títulos valores en su Registro centralizado de facturas electrónicas, según Mario Márquez Olier, gerente de Factura Electrónica en la Dirección de Impuestos y Aduanas Nacionales (DIAN).

Asimismo, para este fin, se creó el Radian; una plataforma que permite a las empresas negociar las facturas pendientes y que llevará un registro del historial de créditos comerciales de las facturas electrónicas.

According to Mario Márquez, in the coming years we would have the  potential to inject more than $100 trillion of fresh resources annually into the business economy  . For this reason, it is imperative and necessary to implement electronic factoring in the country.

The buyer of the invoice can be natural or legal and can negotiate it through technological platforms, such as  fintechs


Grow Chile.





Cali Chamber of Commerce.



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