Collateral free working capital
Fund your exports growth using your foreign trade receivables.
Invoice Factoring: How it Works & its Advantages for SMEs
Working Capital Finance Without Collateral to Grow Your Exports
What is Invoice Factoring?
One of the fastest and easiest ways to offset the impact of outstanding account receivables on your cash flow is by selling your export invoices at a discounted rate to a factoring company like Drip Capital. In exchange, you get upto 80% of your export invoice value on the day of shipment, rather than waiting for the complete payment from your buyer at the end of the credit period. Drip Capital, the factor, takes over the responsibility of collecting payments from your buyers so that you can focus on your business. Once the credit period is reached, the buyer pays the full amount to Drip Capital and you get the remaining 20% minus the factoring fees. This is called Invoice Factoring, sometimes also referred to as Invoice Discounting or Bill Discounting. Drip Capital’s Invoice Factoring solution helps bridge the credit gap between small and large enterprises by making it easier for an SME to gain access to export finance without the need of any hard collateral or business financials. Our factoring product is designed in a way that lets SMEs immediately release their working capital from foreign trade transactions and utilise the funds at any stage of the business lifecycle, to pay for inventory, raw materials, employees, or any other short-term needs. This is a non-recourse factoring solution which means that if the buyer defaults on any invoice financed by us, the obligation to pay back the amount does not fall on the exporter as all the financed invoices are insured.
Why Invoice Factoring?
Are you an SME exporter? Have you extended a credit period to your foreign buyers? Do you often wait for buyer payments? Is your bank’s restricted credit facility limiting the growth of your export business? Do you want a financing solution for your working capital needs that is fast, paperless, reliable, transparent and collateral-free? If you have answered yes to any of the above questions, you need invoice factoring to get that competitive advantage. Here’s how our non-recourse invoice factoring product can help you grow your export business.
invoice factoring Advantages
Offer flexible payment terms to your foreign buyers
Get a line of export credit over and above your bank’s credit facility
Maintain a positive cash-flow
Easier and faster access to working capital
Never wait for buyer payments
Reduce your dependence on bank loans
How Invoice Factoring Works?
Submit invoice digitally on Drip's Portal
Get 80% invoice value in advance
Buyers pays 100% to Drip capital
We pay you remaining 20% less our charges
Why Choose Drip Capital
We are a fintech company focused on solving the working capital problem for emerging market SME exporters by leveraging data and technology. We are re-building core parts of international trade finance infrastructure to level the playing field for small businesses
Credit limit up to $2.5 Million
Get post-shipment export credit line up to $2.5 million.
Competitive pricing
Cost of export financing can be as low as 0.7% per month basis credit evaluation.
Paperless, swift, transparent
Use Portal by Drip Capital for faster fulfilment and end-to-end service
Quick facts on Drip Capital
$500 M
of Trade Financed
400+
Exporters
70+
Cities
60+
Countries
Our Partners
Growth Stories
Learn about how we’ve 10xed exporters
Tatva Enterprise LLP
Exporter of Plastic products from Maharashtra
7x Increase in Turnover USD millions
We started factoring our export invoices with Drip in FY17-18 and by 18-19 we were getting almost 25% of our invoices financed by them. With the boost in working capital and increased competitiveness in foreign markets because of better terms of sale, our turnover has shown a substantial increase.
7x Increase in Turnover USD millions
Al Sami Agro Products
Exporter of frozen foods from Andhra Pradesh
3x increase in Turnover USD millions
As an exporter you may have a great offering, but without easy access to short-term finance, you face challenges in scaling and have to let go of many opportunities. Drip Capital’s easy and efficient export finance solution has helped us ensure there is continuous cash flow in our business. Now we can convert possibilities which we otherwise would have passed on. The result has been a 220% jump in sales in FY19.
3x increase in Turnover USD millions
Satya Impex
Exporter of Red chillies from Andhra Pradesh
50% wallet share USD millions
When we started our business in 2017, traditional lending institutes could not keep up with the increasing orders from our buyers. With Drip capital fulfilling our working capital requirement, in FY 19 our business reported massive growth as compared to the previous year, over 50% of those export invoices were financed by Drip.
50% wallet share USD millions
Pari Agro Exports
Exporter of Basmati Rice from Punjab
4x increase in Turnover USD millions
Drip’s factoring service has ensured that our liquidity doesn’t remain tied up in invoices for a long time. Since the start of our collaboration, we have been able to cater to more buyers and our export turnover has increased 4x between FY17-18 and FY18-19.
4x increase in Turnover USD millions
In the news
Experience the power of export financing with Drip capital
You’ve got questions…. We’ve got answers
Factoring is the purchase of accounts receivables as opposed to a bank loan that creates liability on the balance sheet.
How is invoice factoring different than a bank loan?
Factoring is the purchase of accounts receivables as opposed to a bank loan that creates liability on the balance sheet.
Looking for more questions?
Invoice Factoring Resources
Export Finance - Why is it required and Types
Learn More
Invoice Factoring: Easy Access to Working Capital for your Business
Learn More