Tungsten Network research shows over 80% of suppliers don’t use supply chain finance
Hesitation in offering SCF was cited as the main reason for non-participation
London, 4 April 2022: Tungsten Network, the world’s largest compliant business transaction network, has revealed that 80 per cent of companies it surveyed don’t use supply chain finance (SCF), despite the obvious benefits. In a recent survey of the suppliers on Tungsten Network, respondents from across 76 countries revealed that despite these findings they do have an appetite for SCF.
The majority of the respondents who don’t participate in a SCF programme said it is because buyers have hesitated to roll out programs to large segments of their suppliers. This appears to be as a result of historical challenges with bank led SCF arrangements.
Yet with supply-chain financing solutions enabling suppliers to get paid quickly, buyers to extend their payment terms, and for the funder to provide financing cost-effectively to the whole supply chain it can have a transformative impact on many businesses.
The survey also revealed that what suppliers are expecting from a supply chain finance programme is:
- An easy-to-use portal (42%)
- A cost-effective program (31%)
- Flexibility to choose which invoices to pay early
- Achievable DSO improvement
Interestingly, from the 19% of the businesses surveyed that already use SCF (bank led SCF), over 53% are unsatisfied with the programme they use.
To address this, and to provide its suppliers and their buyers a robust and flexible option, Tungsten has partnered with industry leader Orbian, the longest-established firm in the SCF industry, to provide a new offering called OTN.
Orbian’s supply chain finance strategy experts, in partnership with Tungsten Network, work with businesses to understand their needs, analyse their spend file and develop a customized solution tailored to accomplish their supply chain goals.
Commenting on the research Paul Cooper, CEO of Tungsten Network said, “Supply Chain Finance provides many benefits to businesses, and we believe access to it should be much more democratic. For too long suppliers further down the chain have been locked out of the best deals. Often those who would benefit the most from SCF have been unable to access it. Yet this research shows the need and desire across the whole supply chain. With our partnership with Orbian, OTN is changing that.”
Tom Dunn, chairman of Orbian said, “This research reflects a number of well-established challenges that exist with bank led SCF arrangements. It is precisely to address these challenges, and thereby ensure that the 80% of suppliers that want to access SCF but currently can’t, that OTN is entirely focused.”
About Tungsten Network
Tungsten Corporation (AIM: TUNG) is the world’s largest, compliant business transaction network. A leading global electronic invoicing and purchase order transactions network; Tungsten’s mission is centred on enabling a touchless invoice process allowing businesses around the globe to gain maximum value from their invoice process.
Tungsten processes invoices for 60% of the FTSE 100 and 68% of the Fortune 500. It enables suppliers to submit tax compliant e-invoices in 54 countries, and last year processed transactions worth over £220 billion for organisations such as Caesars Entertainment, Computacenter, GlaxoSmithKline, Kraft Foods, Mohawk Industries, Mondelēz International, Procter & Gamble, Shaw Industries, Unilever and the US Federal Government.
Founded in 2000 and headquartered in London, Tungsten has offices in the US, Bulgaria and Malaysia, employing over 227 people.