Challenges

To prevent double assignment, financing and consequently fraud cases.

Primary target

Which group does your product/service primarily target?

Description of Innovation

The purpose of the RRC is to have one platform where all assigned invoices/receivables are posted by the factoring companies and banks to prevent multiple financing of the same receivables while financing mostly SMEs. The unique feature of RRC is that it only records each invoice once, which is important to avoid issues of multiple assignment of the same invoices to banks and other financial institutions. The platform is online and is integrated with the System of Revenue Administration at the Ministry of Treasury and Finance. In addition, the platform verifies the e-invoices that are created from the real trade are valid. Moreover, the RRC provides reporting of all receivables data to the sector.

RRC is a system where the assigned receivables subject to factoring and credit transactions are recorded and prevents the same receivable from being used in more than one financing transaction by chec

Results

Since 2015, 36 million documents have been recorded into the Receivables Recording Center by 52 factoring companies and 26 banks, and more than 1.2 million double assignments have been prevented by the end of 2022/03. The Receivables Recording Center has had a positive impact on use of e-documents (e-invoice, e-archive, etc.) due to the important role of e-invoice discounting in SME financing. The e-invoice ratio increased from 23% to 95% within seven years.

In Türkiye, all banks provide trade finance products to their clients. In addition to factoring transactions, other credit transactions, like receivables assignment as collateral and credits against receivables assignment are recorded to Receivables Recording Center by the banks. Although not mandatory to enter transactions other than factoring into the system, several banks record credit transactions to reduce credit risks. While designing this ecosystem, all transactions related to trade finance products are entered the System. The RRC is integrated with some other substantial systems: the e-Invoice System of the Revenue Administration at the Ministry of Treasury and Finance, Participation (Islamic) Banks Association’s Invoice Recording System, Credit Guarantee Fund’s System, Movable Pledge Registry at the Ministry of Commerce and Trade Chain Finance System launched by our Association.