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In commercial Lending transactions Receivables are typically offered as security:

1. •

   as part of a package of security over the whole of a company's assets (see Practice Note: Key features of debentures), and

2. •

   in transactions where a steady stream of receivables forms a major part of the Borrower's assets and the lender wants to control that income stream (for example, where the borrower is a company which provides goods and services to third parties)

This Practice Note explains the key issues which arise when taking security over receivables.

For information on taking security over other types of intangible assets see Practice Notes:

1. •

   Taking security over insurance policies, and

2. •

   Taking security over intellectual property rights

This Practice Note focuses on receivables, but more general information on taking security over contractual rights can be found in Practice Note: Taking security over contractual rights.

For specific information on receivables financings, see Practice Note: Invoice discounting and factoring.