AAF purchases invoices that have been issued for products delivered or services rendered. The debtor that has been invoiced settles the invoice by paying directly to AAF. The debtor is not informed of the purchase/cession of the invoice.
Who can apply?
- Any business that sells products or deliver services to a qualifying local or foreign debtor and receives payment on extended terms
- The business will have to conform to the Anglo African Finance credit framework
How do you qualify?
- A balance sheet evaluation of the client is done
- The facility should be covered by an unencumbered debtors book of 150% and
- The company should have 20% of the facility size available as free equity (e.g. R10M facility requires R2M free equity)
- Supply should be to a qualifying debtor
- Santam or Sanlam Group company
- JSE main board listed company
- Central or local government
- Any debtor that is covered by a credit insurance policy
Why Disclosed Invoice discounting?
- No costs to keep the facility in place only pay for what you use
- Take on big clients that demand terms
- Raise funding without having to increase shareholder contributions
- This product converts credit sales to cash, which can enable suppliers to provide credit terms to demanding clients
- The financing can be treated as off balance sheet funding that can enhance the capital structure of the company
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Reuters: Business News