CIMB brings e-supply chain financing solutions to supplier community
Half of Singapore SMEs facing challenges in managing cash-flow, liquidity, and credit risk
14 Nov 2019 | The Asset

SOME S$4.14 billion worth of late payments was owed to Singapore SMEs last year. This is a significant amount of capital that could be reinvested if paid on time. According to Xero’s recent study on late payments, nine out of ten small businesses in Singapore report having clients that do not pay on time. Additionally, some 50% of SMEs were found to be facing challenges in managing cash-flow, liquidity, and credit risk, up from 38% in 2017.

Evidently, late payment is a big problem that plagues small businesses in Singapore. Fortunately, SMEs can now utilize technology to automate a large part of their invoicing and payment cycles so as to speed up the time it takes to get paid. To aid Singapore SMEs in overcoming the gap in working capital, CIMB Bank Berhad, Singapore branch (“CIMB”) announced November 14 its collaboration with SESAMi Holding and Capital Match, to finance the SESAMi trading community’s invoices digitally under an automated workflow.

SESAMi Holding, an e-procurement platform in Singapore, acquired Capital Match, an invoice financing marketplace with operations in Singapore and Hong Kong. Ong Teck Soon, chairman and group CEO of SESAMi Holding says, "SESAMi’s integrated procure-to-pay and supply chain financing allows the suppliers to access lower cost of funds by leveraging on large corporate buyers’ good credit rating."

Suppliers on SESAMi will be paid immediately on their outstanding invoices on the platform within two business days, as opposed to up to a month or longer previously, as soon as they are on-boarded on to the supply-chain financing program.

Victor Lee, deputy CEO of CIMB Singapore and CEO of CIMB Group Commercial Banking says, “The collaboration with SESAMi-Capital Match presents another scalable avenue for us as we are constantly striving to digitize our services and offerings to better service our banking clients. This is aligned with the government’s framework for e-invoices and call for companies to keep up with innovation.”

Capital Match, the e-financing arm leading this initiative will be reaching out to the supplier community to initiate this program. "The funding process will be extremely sped up through leveraging on our Early Payment System (EPS) which was launched earlier this year for the SESAMi supplier community. With the supply-chain financing, suppliers only need to submit minimal documents to be on-boarded under the program and this will facilitate a smooth and simple process for the suppliers," adds Sharath Singh, commercial director of Capital Match.

The process of onboarding onto this supply chain financing program is simplified, with no need to submit invoices as the e-invoices can be selected for financing via the SESAMi platform.

Lai Ven Li, head of Corporate Banking of CIMB Singapore adds, “Once the account is set up under the e-supply chain financing program, technology enables working capital funding to be promptly transferred to our customers. We want our financing package to be attractive to provide our customers a positive experience and access to new financing options. Our objective is to ensure a cost-efficient solution and non-recourse working capital funding option that supports our customers’ growth.”

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