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December 2020

ADF closes 2020 with a top-up in financing programs for IT distributors

Alternative Distribution Financing Ltd. (ADF) is pleased to reach the end of this eventful year with an increase in the size of various Trade Payables Financing (TPF) programs for IT distributors located in Europe and the US.

The TPF programs offered by ADF allow distributors to extend payment terms towards their key suppliers (IT vendors or OEMs) without requiring the legal involvement of the OEMs and more importantly, without incurring in debt financing. TPF facilities are based on the distributor’s confirmed payables and are fronted by ADF, which works with multiple investors, making these facilities easily scalable. All ADF programs are managed by Global Supply Chain Finance Ltd. (GSCF) via its state-of-the-art processing platform.

Kendall Stevens, CEO of GSCF Group commented: “We are very glad to be able to support our customers in their incremental activity in Q4 and beyond. 2020 has been indeed a particular year, during which counting with strong and reliable partners has been crucial. ADF’s Trade Payables Financing programs represent a terrific value proposition for IT distributors that focus their business with key OEMs and we foresee increased demand over the next year, as activity picks up further.

Here is a recap of the main benefits of TPF for distributors:

  • Enhanced liquidity due to extended payment terms on purchases
  • Balance sheet benefits (Accounts Payable or Trade Financing accounting treatment instead of Debt Financing). This is subject to accounting rules applicable in each case.
  • Increased Days Payable Outstanding (DPOs)
  • No legal engagement from the supplier nor changes to the existing supplier’s terms & conditions
  • Additional borrowing capacity from one contractual counterparty (ADF) backed by a diversified pool of investors
  • Increased efficiency with processes managed by the leading servicer GSCF
  • Tailored facilities with quick implementation

To learn more about ADF, please contact us.