Purchase Order Finance also known as PO Funding is a companion product to Factoring and is used to provide funding for the actual manufacturing of goods which then can be delivered against an order by a creditworthy customer.
Once these goods are manufactured and delivered, an invoice is generated that can then be factored with a portion of the advance from Factoring being used to pay back the financing that was extended for the purchase order finance.
Purchase order finance is a companion product to factoring and is commonly used to provide funding for the actual manufacturing of goods so they can be delivered against a “firm” order by a creditworthy customer. Once the goods are manufactured and delivered, an invoice is generated that can then be factored with a portion of the advance from factoring being used to pay back the financing extended for the purchase order finance.
Providing letters of credit to foreign factories and purchase order finance when your company manufactures overseas and produces product for delivery against valid purchase orders. Direct financing for foreign buyers when local financing within the buyers country is not available.Providing credit analysis upon foreign buyers when selling cross border.
What Is Purchase Order Finance & Export Finance? Read More »
