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Supply chain finance options and opportunities

Supply chain finance is all about optimising working capital. C2FO, one of the major players in SCF and definitely the best in SCF straplines as to what it is all about, say we:

  • are “The world’s market for working capital” 
  • “Turn receivables into cash flow and payables into income”

And that their corporate clients can, 

  • “Use the C2FO platform to take complete control of your capital—to improve cash flow on demand or earn no-risk returns.”

Working capital strategy for Air France and IATA

Air France has signed up for the C2FO solution and is the first airline to offer its suppliers their programme. The initiative is considered a strategic use of working capital, enabling Air France treasury and procurement teams to meet KPIs while delivering substantial value to their entire organisation and supplier base.

C2FO believe that this relationship with Air France is a strong endorsement of their brand new strategic partnership with the International Air Transport Association (IATA) the trade association for the world’s airlines, representing some 290 airlines or 82% of total air traffic. Together, Air France, IATA, and C2FO share the mission to support the financial health of the airline industry supply chain.

With the IATA partnership, C2FO can offer the airline industry and its supplier base a collaborative tool that helps airlines improve margins while supporting their supply chain with access to affordable, convenient cash flow to fund growth and invest in the development of new technology for the industry.

Catering for the long tail

One major problem with many SCF programmes is that they don’t cater for the smaller suppliers, who often need the early payment much more than the larger suppliers. This is the market that some suppliers are tackling.

Previse

Previse have a new Trade Finance 2.0 model which covers all suppliers (not just the largest) and extends the duration of the period in which early payment is due:

Source & Copyright©2018 - Previse

Instead of limiting their early payment service to a few suppliers, Previse is enabling companies to offer all suppliers an extension of their payment duration, at a fair rate, with payment from the date of:

  • Purchase order
  • Invoice receipt
  • Invoice approval

Or full payment when the invoice is settled.

PRIMADOLLAR 

PRIMADOLLAR offer a fast, low-cost trade finance service catering for the differing needs of the various players:

  • Suppliers: exporter - your buyer wants you to ship now, and he will pay you later
  • Traders: you need to pay your suppliers and offer credit to your buyers
  • Buyers: you do not want to issue LCs, but you want to work with deferred payment.

PRIMADOLLAR’s low technology solution caters for all sizes and types of suppliers.


CTMfile take: The long tail is the biggest unsolved problem in supply chain finance today. It is simply not right to pay smaller suppliers after an extended period (or late?) and not even offer them an early payment solution.


This item appears in the following sections:
Trade & FSC Management
Trade & Counterparty Risk Mitigation
Trade Finance

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