Invoice Discounting
Invoice discounting is a financial service in which a provider lends cash to a company up to the value of its unpaid invoices.
Many international Suppliers work with deferred invoice payment terms - often up to 120 days - which can put a strain on their finances. Many Suppliers also struggle to qualify for bank loans to ease their cash flow due to having a short or poor credit history.
Benefits of Invoice Discounting
- Easy and fast access to working capital that would otherwise be tied up in unpaid invoices.
- Improved cash flow for Suppliers to pay their own suppliers or invest in the growth of the company.
- Companies are not subjected to long-term, high-interest repayment agreements.
- The invoice discounting application process is usually much simpler and quicker than applying for a bank loan.
- Invoice discounting is usually confidential, so the Buyer never knows that the Supplier has borrowed from a third party.
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