G. Financing receivables
| ($ in millions) | ||
| At December 31: | 2008 | 2007 |
|---|---|---|
| Current: | ||
| Net investment in sales-type and direct financing leases | $4,226 | $4,746 |
| Commercial financing receivables | 5,781 | 6,263 |
| Client loan receivables | 4,861 | 4,652 |
| Installment payment receivables | 608 | 629 |
| Total | $15,477 | $16,289 |
| Noncurrent: | ||
| Net investment in sales-type and direct financing leases | $5,938 | $6,085 |
| Commercial financing receivables | 94 | 113 |
| Client loan receivables | 4,718 | 4,931 |
| Installment payment receivables | 433 | 474 |
| Total | $11,183 | $11,603 |
Net investment in sales-type and direct financing leases is for leases that relate principally to the company’s equipment and are for terms ranging from two to seven years. Net investment in sales-type and direct financing leases includes unguaranteed residual values of $916 million and $915 million at December 31, 2008 and 2007, respectively, and is reflected net of unearned income of $1,049 million and $1,016 million and of allowance for uncollectible accounts receivable of $217 million and $127 million at those dates, respectively. Scheduled maturities of minimum lease payments outstanding at December 31, 2008, expressed as a percentage of the total, are approximately: 2009, 45 percent; 2010, 30 percent; 2011, 17 percent; 2012, 6 percent; and 2013 and beyond, 2 percent.
Commercial financing receivables relate primarily to inventory and accounts receivable financing for dealers and remarketers of IBM and non-IBM products. Payment terms for inventory and accounts receivable financing generally range from 30 to 90 days.
Client loan receivables are loans that are provided by Global Financing primarily to the company’s clients to finance the purchase of the company’s software and services. Separate contractual relationships on these financing arrangements are for terms ranging from two to seven years. Each financing contract is priced independently at competitive market rates. The company has a history of enforcing the terms of these separate financing agreements.
The company utilizes certain of its financing receivables as collateral for non-recourse borrowings. Financing receivables pledged as collateral for borrowings were $373 million and $258 million at December 31, 2008 and 2007, respectively. These borrowings are included in note K, “Borrowings.”
The company did not have any financing receivables held for sale as of December 31, 2008 and 2007.
