Press Release:
1st Commercial Credit expands receivable financing to Mexico
U.S. based
manufacturers, distributors and service providers can now easily
finance accounts receivables in Mexico.
El Paso, TX, Jan 13, 2006 – 1st Commercial Credit Corporation
announces the expansion of their accounts receivable financial
services to Mexico. In the past, a Letter of Credit or cash in
advance was required to meet traditional payment terms. Due to
global competition and new methods to capture market share in
the region, U.S. manufacturers and exporters are staying
competitive by offering attractive credit terms to Mexican
importers. The offering of open credit terms in Mexico has
reached an all time high and is expected to continue to grow.
The average collection period was 90 days on an average net
60-day credit term agreement.
Economic indicators reveal that Mexico is currently experiencing
an economic rebound. Inflation continues to fall and the Mexican
government announced that in 2005, spending in machinery and
equipment rose to 10.2%. According to the latest survey provided
by the Organization for Economic Co-operation and Development
(OECD), in 2006, Mexico’s economy is expected to grow by 4%.
U.S. manufacturers that specialize in exporting to the Mexican
market are anticipating spikes in equipment orders that may
result in negative cash balances on their financial statements.
1st Commercial Credit can help U.S. companies by providing
receivable- based funding during these uneven sales patterns and
long-term collection periods.
According to Raul Esqueda, president of 1st Commercial Credit:
“We are proud to announce the expansion of our services to
Mexico. We are well positioned (with the best institutional
providers) to handle credit analysis, process due diligence and
provide the technological infrastructure to expedite funding to
our clients in a timely manner. This service provides instant
working capital for U.S. businesses selling on credit terms to
Mexican companies without generating liabilities or other
indebtedness on their balance sheets. It is important for a
business to keep existing credit lines liquid for future growth
and inventory fulfillment. Our international financial service
is an alternative way to tap into working capital by using
foreign receivables as collateral without encumbering domestic
receivables or other collateral. Service related industries will
also benefit because this financial program can provide payroll
funding and still offer credit terms to international clients.”
What makes this financial service different from other U.S.
factoring companies that fund international receivables? Some
factoring companies offer international receivable finance in
the U.S. but require the client to factor domestic receivables
to balance their risk factor. Usually, they will not allow the
value of the foreign receivables to exceed the domestic
receivables. This requirement is difficult for a company to
comply with if its export sales are expected to exceed domestic
sales. 1st Commercial Credit can facilitate 100% of foreign
receivable (non-recourse) financing with credit protection on a
per transaction basis.
1st Commercial Credit’s financial program is non-restrictive to
the origin of the products, which may be drop-shipped from any
country. For example, a U.S. based company, importing a product
from France may deliver directly to customers in Canada, Mexico,
and Brazil. Each customer is billed in local currency and
funding is complete within 72 hours (with verification of
delivery and acceptance by the account debtor).
1st Commercial Credit offers products that can accommodate
attractive payment terms for large equipment orders. A U.S.
company selling large ticket items can offer 12-18-24 month
payment terms to their customers. This puts clients at a
competitive advantage because most exporters require letters of
credit or extend only up to 60-day payment terms.
In addition to traditional export financing (which involves a
manufacturer or a distributor that exports tangible products),
1st Commercial Credit can provide receivable based financing for
U.S. service providers including (but not limited to) staffing
companies, I.T. consultants and engineers. Financing
service-related industries in the U.S. is a fairly new practice
(first offered by non-traditional factors). Since it involves
more risk, service companies usually do not have the assets
(such as inventory, real estate or equipment) to pledge as
additional collateral. This financial product will usually
encumber the international receivables.
Besides offering accounts
receivable financing in the U.S.,
Canada, and the UK, 1st Commercial Credit offers export trade
finance to clients in every major world market and can convert
receivable finance transactions in 17 currencies.
US and Canada Tel 1 800 450 9653
United Kingdom Tel 0 800 404 9669
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1st Commercial
Credit, a
nationwide
factoring company headquartered in El Paso, Texas. Provides accounts
receivable financing in the US, Canada, and the UK; offers
export trade finance to clients in every major world
market and can convert receivable finance transactions in 17
currencies.
1st Commercial Credit (SM) is a trademark of 1st Commercial Credit, LLC.
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