What is the difference between pledge of accounts receivable and domestic factoring business? The former is a guarantee? The latter is a wealth management product?

The difference between accounts receivable pledge and domestic factoring business;

(1) Factoring:

(1) is often advertised as a financing service in domestic banks, but its essence is actually an asset trading service. Banks purchase accounts receivable claims from creditors in the form of advance payment, and earn intermediary service income and interest income brought by advance payment.

(2) Under normal circumstances, the ultimate repayment person is the direct debtor (buyer) of the account receivable, not the actual borrower (seller) itself.

(2) Accounts receivable pledge is a simple pledge financing business with accounts receivable claims as the target.

Accounts receivable pledge:

(1) In law, accounts receivable is a kind of creditor's right, and accounts receivable pledge is a kind of right pledge.

(2) Judging from the types of rights that can be used for pledge identified in Article 75 of the Guarantee Law, bills of exchange, checks, promissory notes, bonds and certificates of deposit also represent a kind of creditor's rights.

Domestic factoring refers to:

A comprehensive financial service designed by a factor (usually a bank or a bank subsidiary) to sell goods or provide services on credit in domestic trade.