For a financial service that claims to have a tripartite win-win-win value, current market adoption of Supply Chain Finance (SCF) is still in its infancy. As the credit rating of the larger corporate is leveraged for SCF solutions, suppliers have faster access to cheaper liquidity from invoices. The large corporate can achieve working capital benefits through payment term harmonisation, or it can reduce the COGS (Cost of Goods Sold). Despite clear benefits, the cost and complexity of onboarding small suppliers have resulted in a slower uptake in this group of suppliers and hence, there has been little possibility to take advantage of the benefits SCF can offer.
B2B Fintech Payments, Supply Chain Finance & E-invoicing Guide 2016