Accelerating Early Payment to Suppliers – No Supplier Left Behind or an Afterthought?

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Many large corporates are defining the role and remit of their Global Process to Pay space, and attempting to align A/P Automation, eProcurement, eInvoicing, Dynamic discounting, Compliance, Vendor Management, Onboarding, etc. It is no simple endeavor and complicated by multiple subsidiaries operating in multiple jurisdictions.

I am currently looking at the challenges here and also what are some of the trends around accelerating Early Payment with suppliers and in particular where are we on the life cycle of Approved Payable finance.

These initiatives are complicated by the fact that Treasury, Procurement, AP and others must work together. To make significant inroads into procurement spend with Early Pay dynamic discounting techniques rates much be set much differently than WACC or Return on capital. Unless that happens, Early Pay finance will continue to be marginalized and offered to non core, indirect suppliers. Unless of course a corporate is happy to have a third party fund their supply chain.

I am currently speaking with companies in Europe and the Americas to better understand what is working here, what is not, and the relative priorities. If you are interested in having a chat around the adoption you are getting from suppliers in approved invoice financing/dynamic discounting, please contact me. I would be happy to share some findings if you want to chat. You can contact me at dgustin@globalbanking.com

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