GT Nexus to Offer First Scalable Purchase Order Finance Program

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Following the announcement yesterday that GT Nexus will be launching its pre-shipment finance option for suppliers on its system, further details reveal there will be 2 different programs launched – Small Seller and the Standard Seller programs.

Small Seller Program – Up to 100K Outstanding at Any Point in Time

Finance options available are:

  • Post Shipment Financing (90% at invoice)
  • PO Financing (50% at Order 30 days prior to shipment and an additional 40% at invoice) - after being in the program for 30 days
  • No transaction history required

Standard Seller Program – > $100,000 in Financing Available, But Limits Vary by Suppliers

Requires a minimum of 2 years of GT Nexus platform history. Financing options available are:

  • 50% PO Financing (50% at Order 45 days prior to shipment and additional 40% at invoice
  • Post shipment finance 90% at Invoice
  • Early Payment (approved Invoice Finance)

By funding the suppliers full supply chain, suppliers to GT Nexus clients (its buyers) will have off balance sheet finance without any hard collateral (ie, personal guarantees, or other assets). What the lender, Seabury TFX, will do is collateralize the other transactions on the platform as it represents revenue streams.

According to Robert Lin, president of Seabury TFX, it will be easy for suppliers to sign up. GT Nexus is targeting 2 days to turn around requests. GT Nexus will onboard suppliers, conduct KYC and suppliers will sign GT Nexus's legal framework to access finance. Seabury will use the supply chain data to leverage big data.

Robert Lin, CEO of Seabury commented, “We do understand their GT Nexus customer base, their transactions, process, legal framework all those things very well. The future is to build this so we can securitize.  We will be able to see various data points about the transactions, what Seabury does is use that data and bring in same transactional data to look at historical performance and what are the suppliers ongoing transactions on the platform."

They are live running programs right now, having launched an invoice finance program (post shipment) and also launched a purchase order finance program.

Where does Seabury see this going? As milestones become more precise, Seabury believes it can provide a variety of financing solutions. It has a sister company part of Seabury TFX that can bring institutional forex rates into the market as well to handle different currencies.

Sound far-fetched? Maybe, but we now we have the world’s first scalable purchase order finance solution using a network. Love the innovation!

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