Selling Accounts Receivable on The Receivables Exchange to Generage Working Capital

A business that has been approved by The Receivables Exchange to post receivables for sale to Buyers.

Sellers must meet the following criteria:

• At least 2 years of operational history
• Registered to do business in the U.S.
• A minimum of $1.5 million in sales on a trailing 12 month basis.

Businesses interested in becoming a Seller need to complete the online Seller Application which includes the submission of relevant Seller financial information (financial filings, tax returns and Bank Statements). The Exchange will perform a thorough validation check of the applicant including lien searches, bankruptcy searches, and other verifications of the submitted material.  Sellers are also required to pay a one-time registration fee. Once approved, Sellers create an account profile indicating auction preferences and defaults for postings. 

The Seller’s customer. The business who originally purchased the goods or services of the Seller. 

Sellers can post as many or as few receivables as they want, as long as they meet the $10,000 auction minimum. Sellers are able to have as many live auctions occurring simultaneously as they want.

To be eligible for the Exchange, receivables can carry no greater than net 90 terms.  

What happens if my customer (account debtor) doesn’t pay their receivable?

Sellers are bound by a repurchase agreement that states they are responsible for making the buyer whole, should the Account Debtor not pay before the repurchase date.

Sellers have the ability to pre-specify the Minimum Advance they will accept, and Maximum fee they will pay when selling a Receivable.  The Receivables Exchange is a centralized and efficient marketplace that allows Buyers to compete against each other to bid on your receivables, thereby setting a more competitive rate than the pre-specified Seller rate.

One of the tremendous benefits of The Receivables Exchange is that, through our transparent, centralized and real-time marketplace, our Sellers are able to leverage the credit-worthiness of their best customers. For example, if you are a small business that has only been around for 2 years and doesn’t have a long credit history but has some Fortune 500 companies as customers, you could post the receivables of those customers. Your receivable(s) will be evaluated by the Buyers based on the higher credit rating of your best customers.

A Seller has the ability to make its auction more attractive by either lowering its Minimum Advance rate, or raising its Maximum Discount Fee while an Auction is live.  If no bids are made within the auction timeframe, no transaction takes place. The Seller may re-post the receivable(s) as a new auction (with new parameters if you choose).

No. The Receivables Exchange does not notify your customers if you sell a Receivable on the Exchange.  

No. The funding is not considered income and, therefore, it is not taxed. The transaction is a true sale of an asset at a discount. It is always advisable to consult a CPA to discuss your specific tax situation.

To get the best rate on your receivables, post the receivable(s) of those customers with the best possible credit. For example, if possible, choose to post the receivables of your Fortune 500 customers with a good credit rating rather than those of a smaller, unknown customer.

Yes. The Seller is in complete control of the auction.  When setting the auction parameters, the Seller determines a minimum advance and a maximum fee. If no bid meets both parameters, no transaction takes place. The bid that meets both parameters, or improves on both parameters, wins the auction. If multiple bids meet those parameters, the best bid wins the auction.

As often (or as seldom) as you like.

A seller may only cancel a posting under two circumstances:
1.    The Seller realizes that the Receivable for Auction is a non-qualifying Receivable
2.    The Seller receives a Remittance, or Credit adjustment against the posted Receivable

If you wish to terminate your user agreement as a Seller, you can do so at anytime. However, in order to post again in the future you will have to go through the registration and application process. 

There is a one-time Seller registration fee of $500 payable at the time of Seller’s approval for trading over the Exchange. Payment shall be made to TRE by check or wire transfer, or alternatively, TRE will deduct the $500 Registration Fee from the Advance Amount due to Seller if payment has not been received by the time of Seller’s first trade. When a Seller posts receivables on the Exchange, they are charged a $10 posting fee per Account Debtor per auction. If a posting is successfully purchased by a Buyer, the Seller is charged a transaction closing fee, which is subtracted from the advance amount the Seller receives from the Buyer. All transaction closing fees will be transparent to the Seller at the time of closing. All remittance funds that flow through the Lockbox are charged an Administration Fee.  Wire and ACH fees also apply and are passed through to the Seller.

The eligibility process takes an average of 1-2 weeks, depending on the complexity of your company. Once you have returned the signed Seller agreement and registration fee, and all TRE due diligence has been conducted, you will be confirmed as a Seller and then be eligible to post receivables.

No.  The Transaction is anonymous to the Seller.  The Receivables Exchange performs thorough background checks and conducts rigorous due diligence on all Buyers. We ensure that all Buyers are accredited financial institutions.

The Seller chooses how long his/her auction will last. An auction can close on the same day or can last up to ten business days.

The Exchange uses wire and ACH services from a nationally recognized custodian bank and lockbox administrator.

The Seller will have access to the funds the next business day after the auction closes.

No. The completion of a transaction on the Exchange could improve your company’s credit rating.