Clients often ask, “Will my customers know that I am factoring?” The answer is yes, your customers will know that you are using factoring because they receive a document from the factoring company that informs them of the relationship. This document is commonly known in the industry as the Notice of Assignment or, simply, NOA.
Most factors have their own version of the NOA. However, the Notice of Assignment serves the following functions:
- Informs your customers that you are working with a factoring company
- Informs your customers of the factor’s financial rights
- Informs your customers of the new payment address
- Covers any other legal matters
Do all factoring accounts have notifictions?
Not all factoring clients need to send a notice of assignment to their customers. We offer a non-notification factoring program, where your customers are not directly notified. This program is offered to select companies that meet the following criteria:
- Need at least $300,000 in utilised funds
- Work with customers who have good commercial credit
- Have a well-implemented invoicing and collections process
- Have relatively strong financial statements