New finance solutions simplify trade credit
In an ideal world, goods and services are supplied, supplier invoices follow, and payments are made on time. In the real world, not so much.
Xero estimates that almost half of all supplier invoices are settled late. In a study of several million invoices across their 500,000 small business subscribers, they found that almost half of all invoices with 30-day payment terms languished for about 60 days before being paid.
The interruption to cash flow has a deep impact on the obligations of small business owners. More than 40% of retailers report having trouble paying their suppliers on time. That means materials can’t be replenished; orders can’t be fulfilled; opportunities are lost.
Caught in the cycle of non-payment, business slows to a crawl.
There is a better way
As part of the fast-growing specialist SME lending sector, there are new, innovative and cost-efficient ways to pay supplier invoices on time. Non-bank lenders in this space are using technology and innovation to remove the friction in traditional banking transactions.
GetCapital has developed Shift Payments, a payments platform that simplifies trade credit. Your suppliers get paid on time, every time, and you get better trade terms.
It takes just 3 simple steps to make sure your business never misses a beat.
STEP 1: OPEN YOUR ACCOUNT ONLINE WITH END-TO-END SUPPORT
Open your account directly online – or with phone support – using an intuitive ABN lookup function and real-time ID verification for company directors. With the account set up, activate it by linking bank details: your account will be approved within 15 minutes! If approved, Shift will set you up with an initial minimum $2,000 credit limit to immediately begin paying your suppliers.
STEP 2: SPEEDY PAYMENT OF SUPPLIERS
Once your trade credit account is open, you can upload your invoices for Shift Payments to pay your suppliers directly, usually within the next business day. It’s that simple.
STEP 3: GET BETTER CREDIT TERMS
While your supplier gets paid right away, you can pay later on your own terms. Shift offers you up to 14 days free payment terms. If you need more time to pay, you can select more flexible repayment terms up to 90 days for a nominal fee.
Other solutions: Import Line of Credit
There are also more traditional trade finance products like an Import Line of Credit to pay overseas suppliers.
As a revolving line of credit, this is a product that allows businesses to make repeat transactions, within their approved limit. This means repayments replenish the credit balance and interest is only payable on funds used.
Thanks to improved credit decisioning technology, real-time secure data links and third-party integration that leverages thousands of data points, facilities can be approved in as little as 24 hours.
Usually no financials are required for applications under $150,000, and once approved, your overseas suppliers are paid directly. You can even get access to better-than-banks foreign exchange rates. So making overseas stock purchases at the optimal time need never be a problem.
No overseas suppliers? No worries.
If your suppliers are all domestic, there’s an application for that!
In this new marketplace, you will find innovative business overdrafts, and working capital facilities and business loans with redraw options that can be used for any business purpose. Following the same quick and convenient online application process, businesses can access up to $750,000 within 24 hours to pay invoices from local suppliers.
Almost 75% of Australian businesses use external finance to fund growth, manage cash flow and pay operating expenses and suppliers. Competition is breaking down barriers, helping new lenders serve customers in a much faster way with a better experience, more choice and greater convenience.
To learn more, talk to us. As an award-winning, non-bank business lender to Australian SMEs, we offers fair and transparent financing facilities to mainstream businesses including business overdrafts, working capital loans, trade finance facilities, equipment finance as well as property secured loans.