Every aspect of industry, including supply chains, has been affected by COVID-19. Supply chain financing will assist companies struggling to meet their payments during this unpredictable phase.
Many companies have undergone a dramatic disruption in cash flow, still recovering from the impact of this Great Recession. When goods and materials remained idle in shipping containers or warehouses, payments became unpredictable.
Matt Lekstutis, global practice leader of supply chain at Tata Consultancy Services says “Supply chain finance can bring stability and flexibility to these supply chains by bringing the lowest cost of capital to where it is needed most in the supply chain to shift focus from survival to improving efficiency, innovation and investment in new products”.
Finance in the supply chain allows consumers and manufacturers to get more consistency in their payments. Sebastiaan Wissink, a consultant at the Dutch consultancy firm Capital Chains, said that buyers and suppliers need liquidity in the supply chain, particularly now.
What is meant by supply chain finance?
The aim of supply chain finance is to minimize costs for both the buyer and the seller. Usually, it needs a cloud-based platform that both the consumer and supplier have access to.
The video given below explains in detail on what are the four benefits of Supply Chain Finance.
