forfaiting agreements

Forfaiting is a financial arrangement where a seller of goods or services sells the payment they will receive in the future to a third party, called a forfaiter, at a discount. This allows the seller to receive immediate cash instead of waiting for payment from the buyer, which can be several months or years later. The forfaiter assumes the risk of non-payment and collects the full amount from the buyer when it is due. This is commonly used in international trade to provide liquidity to exporters who may face payment delays.