{"id":7097,"date":"2021-04-14T06:56:17","date_gmt":"2021-04-14T06:56:17","guid":{"rendered":"https:\/\/kredx.com\/blog\/?p=7097"},"modified":"2024-12-20T10:24:46","modified_gmt":"2024-12-20T10:24:46","slug":"ease-your-cash-flow-vendor-management-with-discounting-platforms","status":"publish","type":"post","link":"https:\/\/www.kredx.com\/blog\/ease-your-cash-flow-vendor-management-with-discounting-platforms\/","title":{"rendered":"Ease Your Cash Flow &#038; Vendor Management With Discounting Platforms"},"content":{"rendered":"\t\t<div data-elementor-type=\"wp-post\" data-elementor-id=\"7097\" class=\"elementor elementor-7097\">\n\t\t\t\t\t\t<section class=\"elementor-section elementor-top-section elementor-element elementor-element-5df4141 elementor-section-boxed elementor-section-height-default elementor-section-height-default\" data-id=\"5df4141\" data-element_type=\"section\">\n\t\t\t\t\t\t<div class=\"elementor-container elementor-column-gap-default\">\n\t\t\t\t\t<div class=\"elementor-column elementor-col-100 elementor-top-column elementor-element elementor-element-6a43e11f\" data-id=\"6a43e11f\" data-element_type=\"column\">\n\t\t\t<div class=\"elementor-widget-wrap elementor-element-populated\">\n\t\t\t\t\t\t<div class=\"elementor-element elementor-element-33e48b52 elementor-widget elementor-widget-text-editor\" data-id=\"33e48b52\" data-element_type=\"widget\" data-settings=\"{&quot;ekit_we_effect_on&quot;:&quot;none&quot;}\" data-widget_type=\"text-editor.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t<p><span style=\"font-weight: 400;\">Small and medium businesses often find themselves in cash flow crises and debacles of improper resource management. Often these arise due to lengthy credit periods to customers.\u00a0<\/span><\/p><p><span style=\"font-weight: 400;\">Thus, more businesses are embracing <\/span><strong><a href=\"https:\/\/www.kredx.com\/working-capital\/invoice-discounting\">invoice <\/a><\/strong><span style=\"font-weight: 400;\"><strong><a href=\"https:\/\/www.kredx.com\/working-capital\/invoice-discounting\">discounting<\/a><\/strong> as a viable means to bolster working capital. Resultantly, discounting platforms are gaining momentum, striving to streamline and simplify the process as they move forward.<\/span><\/p><p><span style=\"font-weight: 400;\">The platforms are now looked at as a means to simplify cash flow management and improve business-vendor relationships.<\/span><\/p><p><i><span style=\"font-weight: 400;\">Let&#8217;s read on to understand the intricacies in detail.<\/span><\/i><\/p><h2><b>How Do Bill Discounting Platforms Work?<\/b><\/h2><p><span style=\"font-weight: 400;\">These discounting platforms serve as a meeting place for businesses and investors \u2013 entities who purchase the invoices. These pointers below highlight how discounting platforms function and assist both sellers and suppliers \u2013<\/span><\/p><ul><li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The first step involves businesses signing up on the <\/span>invoice discounting<span style=\"font-weight: 400;\"> platform and providing required documents to initiate verification.<\/span><\/li><li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">After verification, businesses get onboard on the platform.<\/span><\/li><li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Businesses proceed to upload unpaid invoices to raise funds against them.<\/span><\/li><li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Accredited investors present on the discounting platforms skim through the invoices and purchase them accordingly.\u00a0<\/span><\/li><li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Following the purchase, a percentage of the invoice amount is disbursed to the concerned business&#8217;s account.\u00a0<\/span><\/li><\/ul><p><span style=\"font-weight: 400;\">Usually, the disbursal time varies from one fintech company to another. You should note that invoices with high credit rating are more likely to get preferred over others.\u00a0<\/span><\/p><p><span style=\"font-weight: 400;\">On that note, let us now proceed to find out the impact of <\/span><strong><a href=\"https:\/\/www.kredx.com\/bill-discounting\/\">bill discounting<\/a><\/strong><span style=\"font-weight: 400;\"><strong><a href=\"https:\/\/www.kredx.com\/bill-discounting\/\"> platforms<\/a><\/strong> on cash flow and vendor relation to evaluate its role.<\/span><\/p><h3><b>Impact Of Discounting Platform On Cash Flow<\/b><\/h3><p>Invoice discounting<span style=\"font-weight: 400;\"> platforms come in handy for businesses who wish to resolve their cash flow crisis without increasing their existing debt burden.\u00a0<\/span><\/p><p><span style=\"font-weight: 400;\">As discussed, to access funds through such platforms, multiple formalities are not necessary. A quick upload of the invoices will help you initiate the process in no time.<\/span><\/p><p><span style=\"font-weight: 400;\">Here&#8217;s how discounting platforms help a business&#8217;s cash flow \u2013<\/span><\/p><ul><li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">There are more than 42.5 million MSMEs in India, but only a small percentage of them are eligible to receive formal credit. To remedy the need for liquidity and include more MSMEs in the lending scenario, several fintech companies now extend cash against invoices at simple terms.<\/span><\/li><li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">With these platforms&#8217; help, businesses who engage in credit sales can spread out the accompanying risk of default. They can further unlock the tied-up funds in their invoices before the maturity period and, as a result, bridge the working capital gap.<\/span><\/li><li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Most fintech companies do not require businesses to provide any asset as collateral. It helps small and medium enterprises with insufficient assets to raise funds without any hassle. Also, you do not need to worry about losing high-end assets in case of default.\u00a0<\/span><\/li><li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Unlike most business loans, funds raised against invoices do not have any end usage restriction. It means you can use the money raised to meet any cash flow, debt, or working capital-related requirements.\u00a0<\/span><\/li><li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Leading fintech companies provide quick access to capital that helps meet urgent capital requirements quickly. For instance, <\/span>bill discounting<span style=\"font-weight: 400;\"> platform like KredX helps obtain funds within 24 hours to 72 hours*.<\/span><\/li><\/ul><p><span style=\"font-weight: 400;\">Above all, most discounting platforms provide service that does not impact a business&#8217;s balance sheet and does not complicate the accounting process.\u00a0<\/span><\/p><h3><b>Impact Of Discounting Platform On Vendor Management\u00a0<\/b><\/h3><p><span style=\"font-weight: 400;\">It is as essential for all types of businesses to coordinate with vendors as it is to listen to customers. <\/span>Bill discounting<span style=\"font-weight: 400;\"> platforms help enhance the process of vendor management in these ways \u2013<\/span><\/p><ul><li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Businesses can now pay their vendors on time due to a shortened working capital cycle.<\/span><\/li><li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">They can take the risk of agreeing with their vendor for a short credit period.<\/span><\/li><li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Businesses opting for <\/span>invoice discounting<span style=\"font-weight: 400;\"> can maintain confidentiality about their funding arrangement. This helps to retain both customers and vendors.<\/span><\/li><\/ul><h4><b>Bottom Line<\/b><\/h4><p>Invoice discounting<span style=\"font-weight: 400;\"> has paved the way for many small and medium businesses to resolve their cash flow crisis successfully. Similarly, with quick and unrestrained access to <a href=\"https:\/\/www.kredx.com\/what-is-working-capital\/\">working capital<\/a>, companies can also provide agreeable terms to vendors, thus, facilitating cordial relations.<\/span><\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t<\/div>\n\t\t","protected":false},"excerpt":{"rendered":"<p>Small and medium businesses often find themselves in cash flow crises and debacles of improper resource management. Often these arise due to lengthy credit periods to customers.\u00a0 Thus, more businesses are embracing invoice discounting as a viable means to bolster working capital. Resultantly, discounting platforms are gaining momentum, striving to streamline and simplify the process [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":7098,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[35,112,65],"tags":[72,173,37,480,38],"class_list":["post-7097","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business","category-cashflow-management","category-invoice-discounting","tag-bill-discounting","tag-cash-flow-management","tag-invoice-discounting","tag-vendor-management","tag-working-capital"],"_links":{"self":[{"href":"https:\/\/www.kredx.com\/blog\/wp-json\/wp\/v2\/posts\/7097","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.kredx.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.kredx.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.kredx.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.kredx.com\/blog\/wp-json\/wp\/v2\/comments?post=7097"}],"version-history":[{"count":4,"href":"https:\/\/www.kredx.com\/blog\/wp-json\/wp\/v2\/posts\/7097\/revisions"}],"predecessor-version":[{"id":19644,"href":"https:\/\/www.kredx.com\/blog\/wp-json\/wp\/v2\/posts\/7097\/revisions\/19644"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.kredx.com\/blog\/wp-json\/wp\/v2\/media\/7098"}],"wp:attachment":[{"href":"https:\/\/www.kredx.com\/blog\/wp-json\/wp\/v2\/media?parent=7097"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.kredx.com\/blog\/wp-json\/wp\/v2\/categories?post=7097"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.kredx.com\/blog\/wp-json\/wp\/v2\/tags?post=7097"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}