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FinShare Overview     |     Bank Payment Obligation (BPO)     |     Supplier Finance (Reverse Factoring)     |     Receivables Finance     |     Factoring     |
Purchase Order Financing     |     Asset Based Lending (ABL)     |     Risk Participation     |     Document Preparation (DocPrep)     |     Customer Onboarding (COB)

Industry Terminology used in Reverse Factoring:
  •     Negative Financing
  •     Supplier Financing
  •     Buyer Based Supplier Finance
A problem facing many small businesses is getting financing, especially financing during the supplier's production cycle.   Many small businesses, especially those in emerging markets,  do not have the credit worthiness to obtain good financing terms.   What is unique about Reverse Factoring is that the financing for the supplier's receivables is solely based on the credit worthiness of the buyer and not of the supplier.  The buyer, who is usually a large solvent company with excellent financial ratios, has a prearranged agreement with the bank to guarantee payment for specific invoices.  If the supplier agrees, the bank will then extend liquidity to the supplier based on the credit risk of the high quality buyer and not of the high risk supplier.  When the buyer makes a payment, the bank closes the financing loan minus interest/fees and remits the balance to the supplier.  The advantage of Reverse Factoring is that it is an attractive financing tool that allows the buyer the benefit of longer payment terms, while providing high risk suppliers with immediate working capital at low financing rates.
  FinShare Suite Illustration
FinShare Suite Illustration  

Business Benefits

This product allows Banks and other Financial Institutions to provide maximum working capital to their Customer Base in a time frame the competition cannot match

  • Increase working capital leverage
  • Streamline the receivables process
  • Increase liquidity and operational efficiency
  • Enhance visibility into cash management, with great agility
  • Improve cash flow and reduce outstanding debt
  • Provide faster financing for the customer
  • Generate opportunities for better suppliers and better supplier pricing
Solution Highlights
  •    Automated uploading of approved Payables Files
  •    Approved sellers have access rights to select specific invoices for financing (from the pre-approved invoices from the buyer)
  •    Straight-through processing to reduce costs, errors, omissions, and fragmented
    manual processes
  •    Automated data uploading and bi-directional sharing of data and communications
  •    Clients have access to input, query, correspondence services, and client account updates
  •    Buyers and Sellers have access to automated reporting (including credit experience), to simplify collections
  •    Detailed information access, such as multilevel reporting and monitoring, on-line dashboards and analytics, daily activity and settlement reports
  •    Improved internal controls and risk management to meet Sarbanes-Oxley and regulatory adherence requirements
  •    Transaction audit trails,  stored documentation, multi-level reporting, alerts, and  notifications
  •    Seamless integration with existing support infrastructure through major vendor and industry standards
  •    Built on interoperable technologies, including Java/J2EE/ XML, and SWIFT
  •    System security that provides for user access control and authentication, which can be incorporated into the company's own security environment

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