Payables Finance

Abstract

The funding of payments to suppliers is explored across different stages of the trade cycle. Risk assessment is described to include the status, dependency, and performance of suppliers. The funding structures are discussed for supplier payment, trade loans, drawdown documentation, and risk considerations to include the funding of advance or deposit payments. The importance of an identifiable and reliable transactional source of repayment is highlighted and the use of a well-structured export letter of credit. The use, operation, credit assessment, and key considerations for the buyer, supplier, and financier of approved trade payables finance (supply chain finance) are explained.