// definition
SCF
Supply chain finance
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Short definition
A finance provider pays a supplier before the buyer’s agreed due date, then receives the buyer’s payment. Assessment starts with the commercial obligation, transferred rights and cash-flow timetable. An advance against an expected sale also carries the risk that the sale never occurs.
risk atlas
Knowledge map
Intuition
The finance provider advances cash to the supplier; the buyer later settles an identified commercial obligation.
Related analyses
- Greensill: lending before the invoice existsFuture receivables, insurance and cash availability.
Primary sources
- Bank of England, 6 May 2021Page 3: supplier finance and Greensill’s funding model.
- IASB, 25 May 2023Disclosure of amounts, payment dates and liquidity risks.