FAQ

Active Payable Discounting is a business process through which supply chain buyers actively and dynamically retire their accounts payable ahead of schedule at a discount. Buyers benefit by earning double-digit risk free annualized returns on funds employed to pay suppliers early at a discount. Suppliers benefit by turing their approved invoices into immediate cash without having to rely on lenders or outside funding sources.

BidPay^® creates a liquidity marketplace that benefits both buyers and suppliers. Buyers and suppliers establish the market price for faster payments through a bidding process on BidPay^®‘s patent pending portal. Buyers with surplus liquidity determine the annualized yield they require to deploy surplus liquidity to retire payables ahead of schedule. Suppliers that bid discounts which meet buyer’s financial objectives obtain immediate payment on approved invoices while buyers earn risk-free double-digit reruns on investment.

Credit constrained suppliers are reluctant to appear “needy” and therefore may accept lengthy payment tems imposed on them by their large customers as a fact of life. Bidpay finds missed discounting opportunities for buyers while providing a valuable source of liquidity for your cash- and credit-constrained parts of your supply chain.

Buyers with occasional surplus liquidity that impose lengthy (or that are considering stretching) supplier payment terms benefit the greatest by offing BidPay^® as a cash flow solution for their suppliers. Buyers with a large and diverse base of small to mid-sized suppliers, located domestically or internationally, will not only realize direct financial benefit by deploying BidPay^®, but they will also strengthen their supply chain by increasing supplier on-time delivery rates and improving supplier quality control.

Buyers optimize the discount opportunity window by approving invoices quickly AND by offering payment terms to their suppliers between 45 and 120 days.

Based on our first-hand experience involving millions of supply chain transactions valued in the $ billions USD, buyers should project to net $5 million for every $ billion of payables placed for auction.

No. Supplier invoices are not eligible until they’re approved for payment. Once per week, buyers upload a file to BidPay^® that contains only those supplier invoices which have been approved and authorized for payment, but that are not yet “due” by their terms. BidPay^® sends notices to suppliers when they have invoices on which they may obtain payment ahead of schedule.

The use of temporary surplus liquidity or excess short-term borrowing capacity to retire payables at a discount ahead of schedule produces a risk-free net interest margin of over 1,000 basis points on ever dollar of payables retired ahead of schedule, on average.

Like other forms of receivable financing, supply chain financing marketed to your suppliers by banks and finance companies require your suppliers to apply and QUALIFY. BidPay^® is fluid. Suppliers do not have to apply, register, or qualify for rigid underwriting requirements. Obtaining payment ahead of schedule through BidPay^®‘s technology is available to all your suppliers no matter where they’re located. Supply chain financing programs restrict availability to only certain suppliers.

Presently, suppliers discount $ trillions of receivables annually. Many more $ trillions of receivables are financed annually through a variety of other methods. Your suppliers will be delighted you’ve provided them an option to obtain faster payment directly from you, reducing their dependence on outside funding sources.