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I thought that factoring without recourse charges comparatively higher than factoring with recourse in general. But the result (June 2008 Q3 b ) says factor’s fee will be comparatively higher than with non-recourse factoring . I just wonder the correct explanation desperately.
No – what the examiner has written is correct.
With-recourse factoring means that the company (not the factor) suffers any irrecoverable debts.
Without-recourse (or non-recourse) factoring means that the factor suffers any irrecoverable debts.
Therefore, without/non -recourse factoring is more expensive.