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Introduction
Skyscend is your partner in success. We help you convert every invoice into a revenue opportunity and unlock working capital for yourself and your suppliers using Supply Chain Financing against your accounts payables. We collaborate with large enterprises and their numerous micro, small and medium sized suppliers. We enable and empower our business partners with easy and quick access to working capital through payable financing. Let us help you understand some of the basics of Supply Chain Finance, and how we can help you succeed and become more competitive.
What is Supply Chain Finance?
Supply Chain financing is a set of solutions that optimizes and accelerates cash flow by extending short-term finance to suppliers that are part of the value chain of large companies. In Supply Chain Financing, we evaluate the supply chain and its partners together rather than considering the individual company. We use technology to gather data and information to evaluate and prevent risks rather than using collaterals. The use of technology and supply chain relationships, helps us to reduce risks and costs at the same time. This results in win-win-win situation for the buyers, the suppliers, and the financers.
Supply Chain Financing involves:
Financing and Risk Mitigation
Working Capital
Open Account Trade Technology Platform
How does our Supply Chain Finance work?
We bring all the players of a Supply Chain, i.e., the Buyers and their Suppliers, on one platform and add a new collaborator to it – the Financer. These financers are not the traditional financers who evaluate each business entity separately and need a primary security or collateral for providing working capital. Rather, we use technology and supply chain relations to fund the working capital for suppliers and buyers.
- The buyer submits a purchase order with the supplier. The supplier delivers the goods or services and submits an invoice to the buyer.
- Once the buyer approves the invoice, it is pulled by our platform.
- The supplier can log in anytime on our SCF platform via the web or the app, to check the status of their submitted invoices with the buyer
- Once the invoice has been approved, the supplier has the option called ‘Early Pay’ to get paid within 24/48 hours rather than wait for the full 30/45/60/90/120 days payment period.
- If the supplier opts the Early Payment:
- They get paid by our Financers, their invoice amount less a nominal fee, directly in their bank accounts via various payment channels.
- The buyer then pays the financer as per negotiated terms between them.
- Otherwise, the suppliers get paid in full by the buyer as per the terms of their contracts.
Benefits of Supply Chain Financing?
Buyer Benefits
- Optimize working capital by extending the payment terms
- Maintain more cash on the balance sheet without taking on debt
- Achieve payment term flexibility by extending DPO
- Enhances the balance sheet of the buyers as it increases their cash in hand, which can be used to pay interest-bearing debt OR fund other high-return projects.
- Having longer DPO is more attractive to investors.
Seller Benefits
- Get early payments on invoices due later
- Get access to Working Capital without taking on debt
- Shortened DSO as supplier gets paid as immediately after submitting request in an easy, secure, & convenient way.
- It enhances their balance sheet by reducing their accounts receivable, improving their asset turnover, and reducing debt and interest expenses.
- Having shorter DSO is more attractive to investors.
Some of the common benefits of SCF for both Buyers and Suppliers are:
- Quick and easy access to Working Capital.
- Increases cash in hand for both the buyers and the suppliers.
- Empowers companies to control their cash positions and better manage their funds.
- Helps Buyers and Suppliers with seasonal demands, or sudden surge in festive demands, and bulk orders by giving them the flexibility needed to grow their businesses.
- Helps businesses stay more competitive.
- Helps to mitigate supply chain disruptions because of the credit crunch.
- Better risk management using latest technology and supply chain relations.
- Provides additional leverage using multi-investor capital (banking and private).
- Helps supply chain partners improve their cash flow, asset productivity/turnover, costs, revenues, and profitability.
Thus, our Supply Chain Finance solutions help micro, small, and medium suppliers and large enterprises with greater transparency, flexibility, and control. All this helps businesses grow and create more employment opportunities.
Skyscend is a FinTech firm with headquarters in Atlanta, GA and Bengaluru, India. Skyscend builds transformative technology solutions for global trade. Our focus is customer procurement excellence through the application of modern technology that makes commerce easy to use. We build cloud-native products in the procure-to-pay continuum with technologies such as AI and blockchain for simplicity and transparency. Our customers are global corporations looking to optimize their legacy AR & AP processes to small and medium organizations beginning their digital transformation journey.