Supply Chain Finance | 2022 Supply Chain Finance (SCF) Guide

An introduction to Supply Chain Finance (SCF) / Payables Finance

Trade Finance Global / Supply Chain Finance | 2022 Supply Chain Finance (SCF) Guide

Supply Chain Finance | 2022 Supply Chain Finance (SCF) Guide

Welcome to the TFG Supply Chain Finance (SCF) and Payables Finance hub. Find out about how we help corporates and large businesses access supply chain finance programmes, or keep up to date with the latest research, information and insights on supply chain finance.

What is Supply Chain Finance?

Supply Chain Finance (also known as SCF, payables, reverse factoring and supplier finance), is a cash flow solution which helps businesses free up working capital trapped in global supply chains. Supply Chain Finance has recently been defined as a much broader category of trade financing, encompassing all the financing opportunities across a supply chain. Notwithstanding, the product is still very much seen from a narrower perspective, where its key feature is that it is buyer/debtor driven. In such a case, a buyer approaches its financial provider for the establishment of a receivables discounting line for its suppliers to use and discount the invoices they issued to that buyer.

It is a solution designed to benefit both suppliers and buyers; suppliers get paid early and buyers can extend their payment terms. This solution allows businesses which import goods to unlock working capital as well as reduce the risk associated with buying goods in bulk and/or transporting them globally. SCF is generally defined as ‘an arrangement whereby a buyer agrees to approve his suppliers’ invoices for financing by a bank or other financier’.

The term Supply Chain Finance (SCF) is often also referred to as

Given that there are no ICC rules for SCF (like there are for Letter of Credit or Incoterms), it’s often up to each provider to decide what they call it.

Despite the publishing of the ‘Standard Definitions for Techniques of Supply Chain Finance‘ by the International Chamber of Commerce in 2016, the definition is not yet widely adopted and providers of SCF often use various terms to describe their product offerings.

Receivables finance on the other hand, is well defined as ‘the purchasing of receivables or invoices from a seller, with or without recourse’.

In order to address some of the common issues and misunderstandings around SCF, we have put together this short guide.

Diagram: How does Supply Chain Finance work?

payables finance diagram

How can Supply Chain Finance benefit my business?

SCF is a very efficient way to underpin the stability of a Buyer’s supply chain and market reach vis-a-vis its suppliers, allowing it to benefit from better credit terms and streamlined invoice payment procedures (supply chain finance tends to be made available through online platforms). It is also very beneficial to suppliers, as it allows them to shorten their receivables cycle and therefore reinvest their operational cash-flow at a faster pace. The advantages also tend to include financing in better terms for both parties, as suppliers don’t need to take out financing under their own credit lines and may benefit from their clients’ access to credit at lower rates, and buyers may get credit from their suppliers at a lower cost than that of taking out a loan.

Benefits to buyers/ importers

  • Buyers can maintain a healthy balance sheet
  • Buyers maintain a good relationship with suppliers
  • Promotes competition/ diversity in suppliers
  • Allows buyers to make purchases in bulk to save costs
  • Buyers can work with complex end-to-end supply chains
  • SCF doesn’t disturb existing bank relationships or overdrafts

Benefits to suppliers/ exporters

  • Suppliers can get paid earlier than their usual 30-day credit terms
  • Little financial risk – insurance is sorted through a supply chain financier
  • Doesn’t cost the supplier any extra
  • Allows supplier to have the cashflow to work on numerous deals simultaneously
  • Helps provide liquidity and reduces financing costs

How can we help?

The TFG supply chain finance team works with the key decision-makers at 270+ banks, funds and alternative lenders globally, assisting companies in accessing trade & supply chain finance.

Our international team are here to help you scale up to take advantage of trade opportunities. We have product specialists, from machinery experts to soybean gurus.

Often the financing solution that is required can be complicated, and our job is to help you find the appropriate trade finance solutions for your business.

Read more about Trade Finance Global and our global team.


Get started – talk to our team

Contact Information

If you have a supply chain finance enquiry, please use the contact form.

Otherwise, you can reach us on the email addresses below.

Trade Finance Global
201 Haverstock Hill
Second Floor

Telephone: +44 (0) 2071181027

Supply Chain Finance Enquiries

Want to learn more about Supply Chain Finance?

Look no further. We’ve put together our feature trade finance insights, research and articles, and you can catch the latest thought leadership from the TFG, listen to podcasts and digest the latest in international trade right here.

From the Editor – Supply Chain and Payables Finance Insights

Visa Highs & Lows VIDEO | Visa: the highs and lows of B2B payments To learn more about the cross-border B2B payments landscape, Trade Finance Global (TFG) interviewed Ben Ellis, global head of Visa B2B Connect.
UK trade and export finance why now VIDEO | UK trade and export finance: why now? Between Brexit, COVID-19, and supply chain disruptions, foreign markets do not look the most inviting for UK businesses.
accenture report overcoming challenges and finding competitive advantage in the trade finance sector Accenture report: overcoming challenges and finding competitive advantage in the trade finance sector Accenture released a report on findings from an online survey conducted to determine challenges banks are facing, both in retaining trade finance partners, as well as thwarting competition from fintechs.

Videos – Supply Chain Finance

Supply Chain Finance Podcasts

Supply Chain Finance – Frequently Asked Questions

Who can use Supply Chain Finance?

Currently, supply chain finance programmes exist predominantly in Western European and US markets, but Asian markets are quickly following suite, particularly India and China. Chief Financial Officers are beginning to include supply chain finance as part of their working capital and treasury agendas. Despite being around for over 70 years, supply chain finance is now being transformed by digital innovation. Proprietary software and technology platforms work with banks to automate and provide instant rates and terms which suit both parties. Payables data will typically get uploaded to a supplier platform and suppliers can immediately approve invoices and see invoices before they mature.

Supply chain finance is great for large corporations or SME suppliers/ buyers. Whether you’re looking to import automotives and vehicles or retail stock such as clothing, supply chain finance is an innovative solution which the UK government fully supports and encourages.

How can Trade Finance Global help your business access supply chain finance?

At Trade Finance Global, we are experts in providing insight on global supply chain and trade finance. In addition, we have a network of expert funders and advisors who have helped SMEs and businesses access finance to import and export goods or services worldwide. We work with you to find out what your business requires.

Our specialists work with leading funders and banks to offer you the most competitive rates; simply get in touch using the contact form below, and briefly let us know what you’re looking for. Alternatively, find out more about supply chain finance by reading some of the articles we have put together above.

How does Supply Chain Finance work?
  1. A Supply Chain Finance facility is entered by the buyer, financier and supplier
  2. Goods are shipped and sales invoice is raised on the buyer by the supplier
  3. Supplier submits invoice to financier’s supply chain finance platform
  4. Buyer approves the invoice on the financier’s supply chain finance platform
  5. The financier pays the supplier, excluding interest and fees.
  6. The financier debits the account of the buyer on the maturity of the invoice

Strategic Partners:

FCI Logo

Get in touch with our SCF team

Download our free SCF guide

Latest News


VIDEO | Visa: the highs and lows of B2B payments

To learn more about the cross-border B2B payments landscape, Trade Finance Global (TFG) interviewed Ben Ellis, global head of Visa... Read More →

VIDEO | UK trade and export finance: why now?

Between Brexit, COVID-19, and supply chain disruptions, foreign markets do not look the most inviting for UK businesses.... Read More →

TFG Weekly Trade Briefing, 14th November 2022

Your Monday coffee briefing from TFG – Commerzbank on standardisation: the key to sustainable trade finance ... Read More →

Accenture report: overcoming challenges and finding competitive advantage in the trade finance sector

Accenture released a report on findings from an online survey conducted to determine challenges banks are facing, both in retaining... Read More →

BREAKING: COP27 sees ICC unveil new standards for sustainable trade

The International Chamber of Commerce (ICC) releases standards for sustainable trade, providing a framework that assesses the environmental sustainability of... Read More →

Into the depth—deep-tier supply chain finance as a driver for ESG development

Deep-tier supply chain finance can be a powerful tool in the ESG toolkit––but implementing this innovative financing approach will require... Read More →

US and UAE agree to invest $100bn into clean energy

In a strategic partnership between the UAE and the US, the two countries have signed the Partnership for Accelerating Clean... Read More →

VIDEO | Citi on navigating volatility and incorporating ESG finance principles into trade finance

Citi has been working collaboratively with its institutional clients to incorporate more sustainability-based principles into their everyday operations; a movement... Read More →

TFG Weekly Trade Briefing, 31st October 2022

Your Monday coffee briefing from TFG – VIDEO | ICC’s Vincent O’Brien on trade in the UAE  ... Read More →

DCSA on why the industry must act to accelerate eBL adoption

At Sibos 2022, Trade Finance Global (TFG) spoke with Niels Nuyens, program director at Digital Container Shipping Association (DCSA), to... Read More →

Double redundant—Standard Chartered discusses supply chain duplication and deep-tier financing

To learn more about the changing nature of global supply chains, Trade Finance Global (TFG) spoke with Standard Chartered Bank’s... Read More →

ESG evaluation: how can we contribute to achieving the SDGs?

Environmental, social and governance (ESG) has been a hot topic for private and public credit insurers. ... Read More →

Global insolvencies on the rise: expected to go up 10% in 2022 and 19% in 2023

Inflationary pressures, monetary tightening, energy crisis and supply chain disruptions are jeopardising corporates’ cash flows. But many governments decided to... Read More →

Supply chain finance: let the market decide

In December 2021, the Financial Accounting Standards Board (FASB) updated its accounting standards to boost transparency around supply chain finance... Read More →

Blockchain, ESG, and data standards driving changes in the trade finance banking sector

Trade Finance Global spoke with Hari Janakiraman head of industry and innovation, transaction banking, from Australia and New Zealand Banking... Read More →

VIDEO | WTO: increasing WSME resilience in global trade

To learn more about women in trade and how to overcome some of the challenges they face, Trade Finance Global... Read More →

Blockchain in bridging trade finance with climate commitment of the shipping industry

Global shipping is one of the most challenging sectors to decarbonise. The International Maritime Organization (IMO) has set out an... Read More →

21 banks report credit risk trade back to pre-pandemic levels, new ICC Trade Register 2022 reports

ICC Trade Register confirms that for larger banks, credit risk in trade, supply chain, and export finance fall back to... Read More →

Data standards: a key to a truly sustainable trade

For sustainable trade finance to scale, the industry needs a uniform model for ESG data that can be used by... Read More →

Interview: Why ‘ecosystem play’ is important for digital trade

Trade Finance Global’s (TFG) Annie Kovacevic sat down with Finastra’s Anastasia Mcalpine (AM) and Contour’s Josh Kroeker (JK) to find... Read More →

Can Europe be the first carbon-neutral continent?

The aim of the strategy - to “make Europe the first carbon-neutral continent” - was always ambitious. The question now... Read More →

African trade finance enters an exciting new phase

It is often debated whether the reported existing trade finance gap, which over the last 3 years has oscillated between... Read More →

Driving a digital agenda for trade: how the ICC is setting the standard

If you mention the International Chamber of Commerce (ICC) to any practitioner––from a bank or a corporate––involved in trade finance... Read More →

SCHUMANN annual multinational conference identifies the importance of technology in understanding risks and opportunities

SCHUMANN, a risk management advisor for trade credit and surety business, held its annual cross-industry and multinational online conference for... Read More →

Emerging markets roundtable: understanding and addressing the trade finance challenges for SMEs

This year’s ITFA 48th Annual Trade & Forfaiting conference, held in Porto, covered a few key themes, one of the... Read More →

Ameriabank on international trade, sustainability, digitisation in Armenia

Trade Finance Global (TFG) sat down with Ameriabank to discuss how shifts in the global trading ecosystem have affected the... Read More →

TFG partners with UKEF and DIT to create a trade and export finance guide

Trade Finance Global has partnered with UKEF, the UK government’s export credit agency, and DIT to produce the UK Trade... Read More →

Podcast: Olá, Porto! ITFA’s Sean Edwards on emerging markets and digitisation

Trade Finance Global (TFG) are proud to once again partner with International Trade and Forfaiting Association (ITFA) at their 48th... Read More →

Industry leaders release visual trade finance taxonomy

To the untrained eye, trade finance can seem like an intimidating assortment of industry terms and acronyms that were designed... Read More →

World of Open Account (WOA) cofounders on the changing face of receivables finance

TFG’s Annie Kovacevic sat down with World of Open Account (WOA) cofounders John Brehcist and Erik Timmermans. ... Read More →

About the Author

Mark heads up the trade finance offering at TFG where his team focuses on bringing in alternative structured finance to international trading companies. Prior to joining TFG (, Mark qualified as a lawyer with a top ranked global trade and structured commodity finance team.

Mark has previously advised commodity trading firms, banks and alternative capital providers on international structured trade financings, pre-export, prepayment and limited recourse structures – notably in the oil, soft commodities and metals sectors. This has included mining finance projects, structured letter of credit facilities, receivables discounting and forfaiting agreements.

Back to Top