During his opening keynote earlier today, Taulia’s CEO and Co-Founder Bertram Meyer introduced how the UK, US and Canadian governments are all getting involved in the moral suasion game in various ways when it comes to getting corporations (and/or government) to pay suppliers earlier. Bertram also suggested France was not far behind in its own efforts, as more “governments [will] join the cause.”
According to Bertram, the first government to get involved was the UK public sector with its Supply Chain Finance Scheme, which started 2 years ago. The concept in the UK has been to ask “large corporates to use SCF to help their supply chain access credit and improve cash-flow at a lower cost” than before. No doubt, part of the result of this activity has been a proliferation of trade financing providers focused on serving the UK market including Taulia, Tungsten, Crossflow Payments and Tradeshift – not to mention Oxygen Finance, a provider that was a first mover in the region.
The US has just gotten behind its own moral suasion efforts with White House backing of the SupplierPay initiative. My colleague David Gustin opines on the subject on Trade Financing Matters:
"SupplierPay builds on the federal government’s QuickPay initiative, which President Obama launched in 2011. That program mandated that federal agencies make payments to small business contractors more quickly with the goal of paying within 15 days. Of course the White House is quick to tout savings from that program. In a press release, they noted “as a result of QuickPay, we have already seen well over $1 billion in cost savings for small businesses since 2011, leading to greater investment and job creation. SupplierPay is the private sector’s equivalent, where companies have committed to pay small suppliers faster or help them get access to lower cost capital.”
Following on the heels of the US and UK, Bertram noted that Canada is focusing on a different initiative in which the government will “go first” with early payment programs. Bertram observes that Canada is currently developing “a supplier financing initiative starting to support small business and promote job growth” and is at the RFP phase with vendor selection occurring in 2015.
Stay tuned as our coverage from Taulia Connect continues.