What is the meaning of revocable and irrevocable factoring?
In irrevocable factoring transactions, the risk of non-payment of the receivables is underwritten by the factor, and with the exception of shipment of defective goods, the customer is held entirely free of recourse. Whereas, in revocable factoring, the risk of nonpayment of the receivables is not underwritten by the factor, and in the case of non-payment of the pre-finance payments made for the receivables, the factor has the right of recourse to the customer.
