A/R Finance & Factoring Terms GLossary

Definition ofCross-Aged Accounts (10% rule)

This amount is deducted when a borrower has a customer with balances over 90 days, and also balances under 90 days. The rule states that when a customer has more than 10% of their total balance aged over 90 days, the remaining balance is also deducted as ineligible. While 10% is the most common cross-age percentage, lenders will sometimes increase the amount to 15% or 20%. The idea behind this ineligible category is that if a customer has not paid their outstanding over 90 days, it is highly unlikely they will pay the current portion (unless in dispute or because of a billing/accounts payable error).

Audio Definition/Pronunciation

OTHER TERMS BEGINNING WITH "C"

Back to Top

Best Factoring Company

Get Started Immediately