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What is Supply Chain Finance?

Supply chain finance is a convergence of several working capital solutions in the business financing domain. However, it has its focus on invoice finance and trade finance. It enables businesses to pay the suppliers without any delay so that there is no disruption in the production and delivery schedule. It also allows enterprises to benefit from early payment discounts by the suppliers. 

Entities involved in supply chain finance offer extra working capital funding to enterprises enabling them to settle the supplier invoices until they receive their due payment from the clients/consumers/customers. The time frame for supply chain finance is up to 180 days.

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Alexander Pacitto
Alexander Pacitto
Saroj was fantastic in getting finance organised for my business. Efficient, responsive and concise. Recommend.
Arjuna Gunasekara
Arjuna Gunasekara
Callum Baxter
Callum Baxter
Vicky Angelucci
Vicky Angelucci
Quick, efficient and easily understood our needs as a small business. Thank you Saroj.
Raphael Mamudi
Raphael Mamudi
Saroj is a life saver. I’ve never met such a genuine and more passionate person about their job. He has absolutely gone above and beyond for me and my business and am so grateful our paths crossed. Thank you brother!
Shey Bhatti
Shey Bhatti
They are the best, I was having defaulted credit application and they sorted me with quick funds to resolve my issues, Also the best part they removed my Default flag on credit file. Many thanks SAROJ
Josh Zhang
Josh Zhang
Dealing with Saroj is nice and easy. He is really professional and diligent ☺ The process is so smooth, I just need to provide all the details then it's done.
Kate Tiller
Kate Tiller
Saroj was incredibly efficient and made this whole process so simpleand easy., I was thrilled to have my approval so quickly and managed so well. I highly recommend Saroj and this team any day of the week! Kate
As a Small Business owner of AA DOOR SERVICES, i would like to thank Sanroj for his help for my financial need with regards to Cash Flow so i can scale up and grow my business. Sanroj was very helpful from the minute i spoke to him over the phone. He walked me through it every step of the way to help me out and speed things up. Overall, a friendly guy and i did not feel pressured while i was on the phone with him. Everything went so smooth and within the duration of 48 hours maximum, the money was in my Business Account. Definitely recommend Broc Finance. Thanks again Sanroj Kind Regards, Alden Arrighi AA DOOR SERVICES
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What are the Essential Features of Supply Chain Finance?

Supply chain finance improves the cash flow for businesses, ensuring consistent growth, minus any disruption due to late payments. The salient features of supply chain finance can be listed as:

  • It covers any cash flow gaps in an enterprise. 
  • Businesses can cover 100% of the cost of the goods from the suppliers. 
  • Supply chain finance offers risk protection against Forex by locking in the rates. 
  • This form of financing requires no security or collateral, relieving the business owner will not have to peg any personal or commercial assets against the loan amount. 
  • The loan approval rate is high, and the business owner can get fast access to funds. 

With Broc Finance by your side, as a trusted finance broker, it will become easy for you to navigate the routes of supply chain finance in Australia. We will make sure to match you with a compatible lender.

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What are the Advantages of Supply Chain Finance?

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Supply chain finance benefits the buyers (the business owners) and the suppliers. Let’s explore benefits for both:

Buyer Benefits

  • There is an instant increase in business cash flow. 
  • Extends the time limit to clear the outstanding payment up to 60-90 days. 
  • Improves the metrics of the business balance sheet. 
  • Supply chain finance does not fall under debt; hence supply chain finance becomes a source of funding off the balance sheet. 
  • Helps the enterprises to maintain compliance with existing bank agreements. 
  • Aids businesses in minimizing supply chain gaps or disruptions. 
  • Allows accessibility to inexpensive financing for the suppliers, backed by the business’ credit rating.  

Supplier Benefits

  • Suppliers benefit from a reduced time limit for clearance of outstanding payment against the goods. 
  • There is no assignment of debt over the supplier’s assets. 
  • Enhances the working capital ratio of the suppliers.
  • Improves the metrics on the balance sheets. 

Lowers the receivables balance, improving the position of the balance sheet because supply chain payments do not fall under the debt category.

How does Supply Chain Finance Work?

Just like any other form of business financing, supply chain finance follows a definite protocol of application, approval, and funds dispersal, mentioned below:

The business organization or enterprise orders goods from supplier

Supplier uploads the invoice after fulfilling the order

Buyer approves the invoice

The lender pays to the supplier at discounted rate

Buyer pays the invoice

Early payment against the goods to the supplier is typically awarded in the form of a special discount.

What kind of Businesses can benefit from Supply Chain Finance?

Supply chain finance is well-suited for businesses that source their raw material or goods from foreign suppliers, selling the products to consumers at base trade-credit rates. Manufacturers that have very tight production schedules because they use imported parts for their products can benefit from supply chain finance. Similarly, wholesalers that have to maintain the stock levels updated in their inventory can leverage this form of financing too. Here is a list of industries that can benefit from supply chain finance:

  • Pharmaceuticals
  • Healthcare
  • Food and beverage
  • IT hardware and equipment
  • Wholesale
  • Construction
  • Manufacturing

Reach out to our experts at Broc Finance to assess your eligibility for supply chain finance.

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How Broc Finance Can Help You?

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Broc Finance has a legacy of helping SMEs in Australia with a plethora of business financing solutions to scale growth and mitigate the cash flow deficits. We have a widespread network of creditors across Australia’s capital structure. It enables us to match our clients with the best lenders compatible with their business financing needs. 

Broc finance ensures:

  • Reliability: We have earned the reliance and trust of enterprises in Australia, helping them get the financing solutions they need for the business to survive and thrive in the present-day competitive market.
  • Constant Growth: We help enterprises scale uninterrupted growth and success by facilitating advanced business financing solutions.
  • Financial Flexibility: Our loan experts have an unscathed track record of facilitating financing solutions for businesses fast and with minimal documentation.

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