The Global Marketplace is in Need for Supply Chain Finance

In today’s global marketplace, liquidity is highly valued by businesses of all sizes whose executives have been reminded that, once again, Cash is King.

Faced with a demonstrable tightening of credit and a significant reduction in liquidity, cash has become an expensive resource for many companies. The impact of this situation is significant, especially in the context of global trade. Working capital is key in the conduct of business, even more so in the conduct of trade across borders, where complexities abound, timelines extend, and liquidity is a necessity, not a luxury.

Consequently, organizations are placing an increasing focus on improving working capital in order to decrease dependency on financial debt, improve the stability of their trading partners, and ensure the strength and longevity of their supply chains in the global marketplace. A large number of companies have trapped cash sitting on their balance sheet. As one of the cheapest sources of financing, it makes sense to squeeze as much cash as possible from working capital before seeking additional external funding – a move that reduces the need for financing or issuing debt and is likely to be looked upon favorably by analysts.

In consequence, working capital management and cash flow financing solutions such as supplier finance have become at the top of the agenda for many senior executives. Supplier finance, also known as accounts payable finance, is a set of solutions that optimizes working capital by allowing buying organizations to lengthen their payment terms to their suppliers, while providing the alternative option to their suppliers to get paid as soon as the buyer approves the invoices. This results in free cash flow for both suppliers and buyers, while minimizing risk throughout the supply chain. It creates a win-win situations for both entities and suppliers receive very attractive financing rates, between 1-4% per annum.

These per annum rates are much more attractive alternatives then is what is available for most suppliers like factoring or dynamic discounting which can charge 1-4% per month.

Introducing the largest supplier finance platform

PrimeRevenue’s web-based platform, delivering early payment for approved invoices in virtually any currency and jurisdictions. More than $250 billion in invoice transactions are processed on PrimeRevenue’s platform in 30 currencies and in 80+ countries around the world every year. Unique among any working capital finance platforms, PrimeRevenue allows the easy substitution, addition or change among funders for each financing program. This gives clients throughout the global marketplace the freedom to choose funding from more than 100 funder sources (bank, insurance companies, finance companies, etc) also giving them the freedom to self-fund their supplier finance program. PrimeRevenue provides each of the parties involved in supply chain finance with a powerful, secure, and unique view as well as control of their processes in the program:

• Buyers upload the invoices they approve to be paid and can view all of the invoices due to suppliers. They can also upload credit memos to they system.
• Suppliers can see all of the approved invoices and choose all or specific invoices for early payment at any time before maturity, either through manual selection through a unique auto-trade system.
• Funders, such as banks, can view the invoices offered to them by suppliers for early payment. Those invoices flow through the funders eligibility criteria. The funder can also view all the supplier finance programs they are involved with on a real-time basis.

PrimeRevenue is honored with more than 100 industry awards and has become the standard supplier finance platform, managing the largest and most successful programs in the global marketplace.

What are the benefits for customers using the PrimeRevenue Platform?

MULTIBANK

Get instant access to 50+ funding sources that provide capital to your supplier finance program.

CREDIT MEMOS

Upload credit notes to offset invoices or payments owed to suppliers.

RESERVE

Create supplier specific reserves to minimize supplier‰’s performance risk by holding back invoices from being paid early.

MULTI-CURRENCY

Transact in multiple currencies throughout different geographies.

COMPLETE AUDIT TRAIL

Full audit trail on all transactions, users and processes.

ELECTRONIC PAYMENTS

Allows suppliers to receive electronic payments to supplier designated bank accounts.

SELF FUNDING OPTIONS

Have the ability to utilize the buyer’s own cash to fund your suppliers and generate additional margins.

More information

Unlike other sources of liquidity, such as lending from the capital markets, supply chain finance programs are flexible and serve as an incremental source of credit as they add to rather than consume existing cash resources. Such solutions are becoming common across the business community, as early adopters and leading companies generated significant benefits from supplier finance solutions. For more information on the steps you can take to unlock hidden cash, and get ahead of your competitors, click here to learn more about supply chain finance.