E-invoicing and Dynamic Discounting – Definitions and Background

Bruno Koch’s 2014 Billentis e-invoicing report has a short section on trade financing, including a quick exploration and definition of dynamic discounting. In his analysis, Bruno defines dynamic discounting “as a process that allows buyers and sellers of commercial goods and services to dynamically change the payment terms – such as net 30 – to accelerated payment based on a sliding discount scale. Dynamic payables discounting is ‘dynamic’ in one or more ways. Dynamic discounting is also known as dynamic discount management, early payment discounting, or payables discounting.”