Working Capital Solutions | Purchase Order Finance

How it Works

Working Capital Solutions, through our Purchase Order Finance product, can pay the client’s suppliers on the client’s behalf, according to the payment and INCO terms stipulated by said suppliers. These payments are only made on the back of confirmed Purchase Orders from the client’s Approved Debtors, or for an Asset Finance client. The suppliers can be either local or foreign entities. ‘Payment’ can be facilitated by way of a Letter of Credit or Telegraphic Transfer.

The products, for which Working Capital Solutions is paying, have to be finished products, meaning there must be no performance risk as a result of the client’s valued-add to the product.

Working Capital Solutions charges a Purchase Order Finance Fee per 30 days, which is a percentage of the full suppliers invoice value. The Purchase Order Loan is settled when the client raises invoices to its Approved Debtors, or when the Asset Finance agreement is activated.

Note: Purchase Order Finance can only be offered to a client if there is a form of guaranteed local off-take – this can be in the form of a Full Book Invoice Discounting Facility, a Single Invoice Discounting Facility, or an Asset Finance Agreement.

Benefits

  • Our Trade Finance department can assist with off-balance sheet finance, which is made available to you to take advantage of business growth opportunities.
  • Hedging and management of foreign exchange risks are mitigated by our Capital Markets division.
  • The risks associated with importation are identified and advice is provided to mitigate the risks.
  • Funding can be raised against irrevocable orders before the delivery of goods has taken place.