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UPS Capital Expands Trade Finance For SMBs

Leveraged loans

UPS Capital is ramping up its focus on small business finance.

The company, a subsidiary of UPS, announced on Tuesday (Jan. 16) that it is expanding its UPS Capital Cargo Finance solution, which provides small- and medium-sized businesses with credit lines to finance goods as they are shipped. UPS Capital is increasing the amount an SMB can borrow from 70 percent of a supplier’s invoice to 100 percent, the company noted. The firm is also extending repayment terms from 75 days to 90 days.

UPS Capital can provide up to $1.5 million for SMBs that use UPS to import goods. The firm confirms the supplier invoice and tracks the shipment of goods to verify when to release financing to the importer.

“These enhancements effectively increase liquidity to support the growth of small- and mid-sized business,” said UPS Capital president Mark Robinson. “They are designed to accelerate cash flow so companies can have more working capital to invest in their business.”

The trade financing offered by UPS Capital does not interfere with existing banking relationships in the supply chain, per the announcement. According to the company, local businesses are not able to meet the financing need of SMBs that import from overseas.

“UPS Capital’s cargo financing solution is a creative way to virtually eliminate the risk of paying a supplier before the goods are sold,” Robinson added. “Now our customers can order more supplies, more effectively manage their payable obligations and handle more inventory without hesitation while goods are in motion. Our customers have been asking for this additional solution to augment our other insurance and financing products for small- and medium-sized businesses.”

Robinson was named UPS Capital’s new president last September. He replaced Ron Chang, who was with the company as it “dramatically accelerated the impact of our services [delivered] to UPS Capital’s customers and added several new capabilities across our UPS Capital portfolio,” according to chief sales and solutions officer Kate Gutmann in a statement at the time.

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