Ameriabank has introduced a new tool - classical factoring. Would you tell about its flexibility and advantages over an ordinary loan?
Ameriabank first of all attaches importance to relations between the bank’s clients and their partners. That’s why the new products we offer are meant to facilitate these relations. Presently, the advantage of factoring is the flexibility ensuring unlimited financing parallel to business development. Unlike loans which are issued for a special purpose, classical factoring is provided simultaneously with the management of business, i.e. the number of orders and bargains concluded with the clients serve as a foundation for financing the suppliers by the bank. It means that the bank undertakes to finance the deals of its clients, granting them a delay.
The second advantage is that no pledge is essential to get financing and, consequently, the client doesn’t bear extra expenses. The receivables act as guarantor for the bank’s financing. Moreover, the bank secures the management of the accounts receivable, preliminary coordinating the individual model with the client, who gets a possibility to determine the final price of the service due to the transparency of the interest system and forecast the amount of profit through calculation of production and sales expenditures. Ameriabank also helps the client inform his partners of the factoring process, thus excluding any misunderstanding that may arouse.
Which are conditions for providing factoring services? Are these affordable for the customer?
In case of classical factoring, the financing is provided in AMD, as bargains are concluded between Armenian residents. The maximum term of financing of one deal is 120 days, with 14% annual interest rate. I would like to mention that it's a competitive interest rate for the client, who is exempted of any additional expenses. The minimum amount provided for one transaction is AMD 1 million.
Introducing the new product, the bank drew a list of companies to cooperate with. Has the list been enlarged since then?
As it was earlier announced, Ameriabank has published the list of 11 companies. The list includes: International Airports Armenia CJSC, Armenia Telephone Company, Yerevan Brandy Company CJSC, Yerevanjur CJSC, Zangezur Copper and Molybdenum Combine CJSC, Electric Networks of Armenia CJSC, ArmRosgazprom CJSC, Armenian Nuclear Power Plant CJSC, South Caucasus Railways CJSC, K-Telecom CJSC and Rusal-Armenal CJSC. We plan to enlarge the list till December 15, 2010. It will comprise companies operating in various sectors of economy, including major retail networks, as the interest in classical factoring is continuously growing.
To familiarize consumers with its new tools, Ameriabank conducts seminars. Which were the most frequently questions asked by the participants?
Factoring financing is widely spread at the international banking market. However, taking into account that it’s a new product at the Armenian market, Ameriabank initiated a series of seminars to provide a detailed familiarization with the novelty. In November, we organized three workshops with participation of different companies engaged in construction industry, pharmaceutics, energy processing, cargo transportation, food production, etc. The questions asked were mostly technical in nature. Participants also wanted to know more about the criteria for inclusion of the above mentioned companies in the list and when the bank intends to expand it. As a have already said, the revised list will be published in the near future.
Do you think your think your product will be in demand in Armenia?
Factoring is a novelty for the Armenian banking system. Ameriabank first adopted the tool in 2008. Classical factoring is one of its trends and we tried to make it more flexible, taking into consideration the peculiarity of the Armenian market. The product will certainly be in demand, as there is a large number of companies in Armenia which have accounts receivable or conclude bargains with a delayed payment. As soon as we examine the market, Ameriabank will offer other innovative products, including other factoring types.