Validity Guarantee

A validity guarantee is a crucial component of invoice factoring; it is a guarantee that declares all information submitted to the factoring company is accurate. However, only businesses owned by a corporation or many individuals are required to submit a validity guarantee. Small businesses or startups owned by one or few individuals usually do not need to provide a validity guarantee.

Once the validity guarantee is signed, the borrower going forward accepts all responsibility for any fraud that occurs during the factoring partnership.