For supply chain finance (SCF) to progress and reach the next set of struggling suppliers, the model needs a rethink. We need SCF 2.0.
Getting to grips with late payments is easier said than done. A single purchase from end-to-end involves multiple departments, and often requires a whole host of steps to ensure compliance.
On face value, SCF looks like the late payments silver bullet. It allows a third-party funder to forward the value of an invoice, minus a small charge, on to the supplier just a few days after the invoice has been approved. Then, the SCF provider recoups the money on the back-end of the payment process, perhaps some 120 days later.