SBS Private Limited

Sales Finance

🤝 Sales

Business sells goods/services: A business sells goods or services to its customers and raises a sales invoice.
Invoice assigned to financier: The business assigns the sales invoice to a financier (e.g., a bank or finance company).
Advance payment:The financier advances a percentage of the invoice value (typically 70-90%) to the business.
Customer pays financier:The customer pays the invoice amount to the financier.
Financier settles balance: The financier settles the balance amount (less fees and interest) with the business.

Improved cash flow: IBusinesses receive immediate payment, improving their cash flow and working.
Reduced credit risk: The financier assumes the credit risk, reducing the business's exposure to bad debts.
Increased flexibility: Businesses can use the funds to meet their financial obligations, invest in growth opportunities, or manage working capital.

Discounting fee: A percentage of the invoice value charged by the financier.
Interest charges: Interest on the advanced amount, typically calculated daily or monthly.
Other charges: Additional fees, such as documentation fees, late payment fees, or administration fees.

Business type: Typically, businesses with a minimum turnover and trading history are eligible.
Invoice quality: The financier assesses the creditworthiness of the business's customers.
Industry: Some financiers may have industry-specific requirements or restrictions.

Working capital: Businesses use invoice discounting to manage their working capital
Growth:Companies use invoice discounting to fund growth initiatives.
Cash flow: Businesses use invoice discounting to manage their cash flow.