Purchase Order FinancingBack to Our Services
Purchase order financing is when a lender pays your suppliers for goods that you’re reselling or distributing to a customer who has completed a written purchase order. You will be able to finance up to 100% of the purchase order amount and the typical rates will be between 1.8% and 6% per month. The process usually takes between 1-2 weeks to fund. If you are looking for a quicker financing option then our working capital loan will be a better option. Purchase order financing helps businesses that require cash to fulfill product orders by paying your supplier for the manufacturing and transportation of goods up front before you receive payment from your customers.
Purchase order financing is typically used by:
- Importers or Exporters of Finished Goods
- Outsourced Manufacturers
It can be used to help when there are seasonal sales spikes, substantial growth or when there are times of tight cash flow.
Purchase Order Financing Step By Step Process
- You receive a purchase order from a customer.
- You have a written proposal from your supplier on the cost of fulfilling the order.
- You apply for Purchase Order financing and are approved.
- Your supplier is paid by the financing company to fulfill the order.
- The supplier fulfills the order and the customer accepts the goods.
- You invoice your customer for the fulfilled order.
- The customer pays the Purchase Order Financing company directly.
- The financing company deducts their fees and pays you the rest.