Fintech company InstantFactoring creates an alternative registration and verification system based on blockchain

Aurel Dragan 14/08/2018 | 18:43

The fintech company InstantFactory launched four months ago launches access to verifying receivables from a company by creating an alternative registration and verification system based on blockchain technology.

Anyone can now check if an invoice or claim has already been divested, thus avoiding multiple-sale frauds. At the same time, any company or institution, regardless of size and financial capacity, can record the bills that have been the subject of such transaction – in the blockchain, with low costs. This sets the foundations for a transparent market in the sale and purchase of claims from legal persons.

“One of the main issues in the factoring area is checking that a certain invoice has not already been purchased by another player in the market. Until now, this risk was removed by querying the Electronic Archive of Real and Securities Guarantees (AEGRM). For low-value bills / transactions, however, the costs of claiming this authority are prohibitive, reaching up to RON 120 per recorded and subsequently canceled transaction, which meant that for some transactions AEGRM would not be used “, says Elisa Rusu, Instant CEO factoring.

“InstantFactoring has developed and is currently using an alternative system based on blockchain technology that we want to open now to the entire factoring / credit / debt recovery market. With the launch of our application on the Ethereum block-chain – which ensures transparency, maximum security and registration integrity – any player on the market will be able to sign up and check if a claim has already been divested at a cost of about 96 percent smaller than in the current system. The recording and deletion of a claim on the blockchain will cost less than USD 5 per transaction if we relate to the actual value of an Ether,” says Elisa Rusu.

The strategy of the digital micro-factoring platform is focused on developing the easiest and fastest flow of financing bills in Romania (and not only) through digitization. Thus, the team can process multiple factoring requests simultaneously, with significantly lower operating costs than the traditional process, thus making it possible to finance low-value invoices, a process that is not profitable in the classical factoring system.

With its FinTech platform launched 4 months ago, helps small businesses and micro-businesses instantly convert cash on time bills by providing them with a cashflow and work capital acceleration solution. The money is returned to the customer’s account within 24 hours of request, for invoices up to 10,000 lei, at a cost of 3 percent per month of the total amount of the invoice.

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