Supply Chain Finance check0 / 1 answered · 0 correct
Check 1
Who is often the key credit risk in payables finance?
Payables Finance / Reverse Factoring
Buyer-led financing that can pay suppliers earlier while the buyer pays later.
Buyer-led programme
A strong buyer may approve supplier invoices and a financier offers early payment to suppliers based largely on buyer credit.
Supplier choice
Well-designed programmes generally allow suppliers to decide whether to take early payment, subject to programme terms.
Buyer payment
The financier is repaid by the buyer at the agreed maturity. The financing is therefore economically connected to approved payables.
Accounting and concentration
Programme structure, disclosure and dependency can matter. A company relying heavily on one funding channel can create liquidity concentration risk.
Standards / source note: Supply-chain-finance terminology is guided by the Global Supply Chain Finance Forum definitions, while the actual legal, credit and operational structure remains transaction-specific.
Remember thisReverse factoring is usually built around approved buyer payables, not an SBLC “monetisation” story.
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