With credit availability remaining tight following the financial crisis, banks and corporations alike are more attuned to the financing opportunities available linked to supply chain transactions. With the transparency of trade transactions and the link between funding and trade activities, Supply Chain Finance (SCF) lessens the risk associated with traditional lending.
Electronic invoicing, presentment and payment (EIPP) systems can amplify the many benefits of Supply Chain Finance by automating a process that traditionally has been hampered by slow, paper-based manual methods. The Supply Chain Finance market in the UK alone grew from about £100 million 2008 to £1Bn in 2010, with the growth expected to continue through 2011. In the past, a number of issues have hampered the growth of SCF:
- - Confusion on legal and compliance requirements
- Lack of document standards
- Manual, slow business processes
- Lack of SME engagement
- Insufficient critical mass of participants
Many of these impediments are being addressed by the growth of E-Invoicing networks. This paper looks at how the continuing growth of E-Invoicing can enable and facilitate the Supply Chain Finance market - and how financing can be a key driver for adopting E-Invoicing.
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