Suppliers are getting paid late across the globe, but it’s a particular problem in the U.K., where late payments have led to high-profile political action and lawsuits. A new report by invoice financing platform C2FO examined what corporate treasurers really think of the types of products and services that could help speed up their payments to suppliers.
As it turns out, C2FO said Wednesday (Feb. 10) that corporate treasurers are generally in favor of invoice discounting solutions.
The company published the results of its Supplier Finance Survey, which found that 71 percent of corporate treasurers in the U.K. agree that invoice discounting can be a value-added service.
Invoice discounting allows suppliers to borrow money against their outstanding invoices; the research, conducted in Q4 2015, also found that 96 percent of treasurers agreed that the role of supplier financing services is on the rise.
That’s good news for C2FO.
“Given the increasing pressure on treasurers to manage working capital and to generate a better return on cash, we have seen tremendous growth, and we expect to see more big buyers implementing invoice discounting programs in 2016,” said C2FO Senior Vice President of EMEA Operations Colin Sharp in a statement.
But the research did not indicate whether there actually is a rise in the use of these types of supplier financing services.
According to the study, 67 percent of corporate treasurers said that their supply chain is beset by cash and liquidity challenges, potentially signaling a gap that invoice financing and discounting could fill.
“Innovative technology is supporting the role of the treasury function, with invoice discounting clearly enhancing the treasury’s added value to the rest of the organization,” the company said in its announcement. C2FO pointed to dynamic discounting in particular, which allows treasurers to access discounts on their purchases for paying earlier.