Bank lending has not yet recovered to pre-crisis levels—nor is it likely to in the Basel III environment. So companies are looking both to explore new sources of funding and reduce their funding needs by concentrating liquidity in-house.

Trade receivables are one corporate asset that can be used to achieve results on both counts and accordingly, companies are increasingly examining opportunities in this area. By improving collections procedures and introducing techniques such as differentiating among creditors according to their risk profile, companies can make significant improvements to their days sales outstanding (DSO). Meanwhile, a range of receivables financing techniques is available to companies looking to improve working capital by monetizing receivables.

Alongside more traditional receivables financing techniques like factoring and securitization, some recent innovations are beginning to reshape this area. Non-bank supply chain finance providers are starting to gain market share with platforms that offer greater flexibility than their bank counterparts. Like the bank programs, these non-bank providers enable corporations to offer supply chain finance to their suppliers.

Continue Reading for Free

Register and gain access to:

  • Thought leadership on regulatory changes, economic trends, corporate success stories, and tactical solutions for treasurers, CFOs, risk managers, controllers, and other finance professionals
  • Informative weekly newsletter featuring news, analysis, real-world cas studies, and other critical content
  • Educational webcasts, white papers, and ebooks from industry thought leaders
  • Critical coverage of the employee benefits and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.