About Reserve Analysis
As your financial institution officer has explained, a percentage of each invoice purchased by the financial institution is deposited into a reserve account. You cannot access this account for operating expenses. The reserve account is pledged to the financial institution as collateral to secure your repurchase obligation for delinquent invoices.
The financial institution officer periodically analyzes the amount of funds in your reserve account to determine whether any adjustments need to be made. Typically, the financial institution conducts the reserve analysis on a monthly basis, but may conduct it more often if deemed necessary. You can request to receive an email notification when a reserve analysis is completed.
NOTE
Please direct any questions about the reserve analysis or the transfer of funds as a result of an analysis to your financial institution officer.
| Reserve account status | Action |
|---|---|
|
Surplus The account has more than the financial institution deems necessary. |
The surplus amount is made available to you. You have two options:
NOTE Some financial institutions offer a third option to move the funds to an investment account. |
|
Deficit The account has less than the necessary funds to support your repurchase obligation. |
Your agreement with the financial institution requires you to provide additional funds. |
