💼 What Is Cession?

When you run a business and deal with clients, invoices, and payments, you’ll likely come across the term “cession.”

But what does it really mean, and why is it so important in finance, factoring, and cashflow management?

This article breaks it all down in simple terms.

🔍 What does “Cession” mean?

Cession means the transfer of a receivable from one party to another.
In other words, Party A (the assignor) transfers the right to collect payment to Party B (the assignee).
From that point on, the debtor (the party that owes the money) must pay the new creditor.

👉 Simple example

Imagine you’re owed €5,000 by a client. Instead of waiting for payment, you transfer that receivable to a factoring company such as Finqle.
From that moment, your client pays Finqle, not you.
That transfer is called cession.

⚖️ The legal side of cession

In Dutch law (Article 3:94 of the Civil Code), there are two main forms of cession:

1. Open cession
   The debtor is formally notified of the transfer and pays the new creditor directly.

2. Silent cession
   The transfer happens without notifying the debtor. The original creditor may still collect payments, but now on behalf of the new owner of the receivable.

Factoring companies like Finqle often use silent cession — it’s efficient, discreet, and doesn’t disrupt client relationships.

💡 Why businesses use cession

Cession offers several key advantages, especially for growing companies:

• ✅ Immediate liquidity: Get your money faster by transferring your invoices.

• ✅ Reduced risk: The new creditor assumes the payment risk.

• ✅ Improved cash flow: No more waiting 30–90 days for clients to pay.

• ✅ Professional collections: The assignee (e.g., Finqle) manages follow-up and administration.

🧾 Cession and factoring: How Finqle uses it

In factoring, your open invoices are transferred to a factoring company, and that transfer happens through cession.
Finqle takes over your receivables, manages your debtor relationships, and handles payments on your behalf.
You get paid immediately, while Finqle manages the rest.

🔁 In short: cession is the legal foundation that makes factoring possible.

⚙️ Conditions for a valid cession

For a cession to be legally valid, a few conditions must be met:

1. The receivable must be existing or clearly identifiable.

2. There must be a written deed of assignment (cession agreement).

3. In case of open cession, the debtor must be notified.

🚀 Cession in practice: Faster payments, less risk

While it may sound technical, cession is simply a smart financial tool.
By transferring your receivables to a trusted partner like Finqle, you free up cashflow, eliminate collection risks, and save valuable time.

💬 Conclusion

Cession is the legal term for transferring a receivable to another party.
For entrepreneurs, it’s a powerful way to improve liquidity, reduce risk, and focus on growth.
With Finqle, it’s easy: we take over your receivables so you get paid faster, without the hassle.