Supplier Finance
Financing solutions supporting exporters through pre-shipment and post-shipment funding arrangements, enabling sustained working capital and trade operations.
What is Supplier Finance?
Supplier finance provides exporters and traders with working capital facilities to support ongoing trade operations. These facilities bridge the gap between cash outflows (production, shipping costs) and cash inflows (payment from buyers), enabling continuous business operations.
Exporters often face significant time gaps between production and payment receipt. Supplier finance facilities address this gap, particularly for transactions with extended payment terms or where immediate cash is required for new orders.
These arrangements are essential for scaling trade operations and maintaining competitiveness in global markets where credit terms are common.
Funding Structures
Pre-Shipment Funding
Financing provided to exporters before goods are shipped, supporting production and working capital needs.
Post-Shipment Funding
Financing extended after shipment, providing immediate liquidity while awaiting payment from buyer.
Working Capital Support
Structured facilities enabling exporters to manage ongoing operational costs and inventory requirements.
Supplier Finance Process
Credit Assessment
Exporter's creditworthiness and transaction details reviewed
Facility Agreement
Terms, limits, and conditions established in writing
Drawdown
Exporter draws funds against facility as needed
Security
Facility secured by shipment documents, receivables, or inventory
Monitoring
Bank monitors shipments and collection status
Repayment
Facility repaid from proceeds of sale or as agreed
Typical Use Cases & Benefits
Key Use Cases
- Scaling export operations
- Financing new buyer orders
- Managing working capital gaps
- Supporting competitive pricing
- Handling extended payment terms
Principal Benefits
- Improves cash flow availability
- Enables business growth
- Reduces financial stress
- Increases operational flexibility
- Supports institutional relationships
Ready to Discuss Supplier Finance Solutions?
Contact Multistream International to explore customized working capital and supplier finance facilities.