Will The Plethora of Early Pay Techniques Give Suppliers a Nightmare?

Step back from the current craze around all the new financial technology solutions for companies to access cash, from e-procurement and e-invoicing solutions to marketplace lending and supply chain finance, and try and think about this from a logical basis – from the perspective of the supplier. You want to pay early. But by the time you figure out how to get it from all these solutions, you’ve logged into half a dozen or more solutions every day that are not directly integrated into your systems. You may even have to hire a few staff. Clearly, this is an area that deserves more attention, which suggests it might move to embracing a supplier-led ecosystem as well.

Third-Party Funding for Dynamic Discounting – Still in Infancy?


On Trade Financing Matters, I’ve been sharing a number of my thoughts in recent days LINK about some of the challenges and hurdles faced in driving greater adoption for third-party financing for invoice discounting and dynamic discounting, as well as some thoughts on what it will take to cross the chasm from corporate and treasury funded-programs. David Gustin, the managing director of Trade Financing Matters, could not sit still after reading what I had to say and decided to chime in himself. Below, I’ve featured a few of his thoughts on the challenges with non-bank funding for invoicing discounting and dynamic discounting models that leverage an approved invoice through an e-invoicing or supplier network connectivity service.

5 Catalysts for Third-Party Funding of E-Invoicing

Yesterday, I covered some of the challenges surrounding the adoption of third-party financing across e-invoicing solutions and supplier networks. But perhaps the more important question is: What will it take for these solutions to cross the chasm from theory to action? I have some hypotheses. Either individually or collectively, it will be fascinating to see how these 5 scenarios come together.

Why E-Invoicing Has Failed to Attract Outside Funding

As Tungsten recently reported in its financial results, the level of adoption for bank or non-bank intermediated financing through supplier networks and e-invoicing programs is still embryonic. Spend Matters and Trade Financing Matters estimate that more than 95% of invoice discounting and dynamic discounting programs that leverage an e-invoicing, supplier network or related platform capability currently rely on corporate self-funding to support such programs on a volume basis today. Finding a logical answer to why third-party adoption is low requires a deep dive.