Invoice Financing/-i

Invoice Financing/-i is a broad concept of financing arrangement where it allows companies to finance their early payment on their sales invoices or sales purchases, for goods delivered and/or services completed. This method of financing is ideal for businesses in need of consistent cash flow or cash upfront, especially if the majority of their transactions are on credit terms.

With Funding Societies, you have two options of Invoice Financing that would suit your needs; Accounts Payable (AP) Financing (Conventional & Islamic) and Accounts Receivable (AR) Financing (Conventional & Islamic).
 
Additionally, you will have access to our online supply chain financing system, Silk Road, to manage your financing facility with us.

AR Financing/-i is typically meant for financing sales invoices, with your perspective as the Seller.
AP Financing/-i is typically meant for financing sales purchases, with your perspective as the Buyer.

Process Flow
Account Payable Financing/-i (APF/-i)
Step 1: Customer submits PO/Proforma invoice etc. via Silk Road
Step 2: Funding Societies proceed credit assessment and approval email provides once approve.
Step 3: Customer receives disbursement from Funding Societies based on the approved terms
Step 4: Repayment to Funding Societies based on the approved terms

Account Receivable Financing/-i (ARF/-i)
Step 1: Customer submits Invoice & DO etc. via Silk Road
Step 2: Funding Societies proceed credit assessment and approval email provides once approve.
Step 3: Customer receives disbursement from Funding Societies based on the approved terms
Step 4: Repayment to Funding Societies based on the approved terms

Notified :
Buyers are notified of the arrangement between Seller and Funding Societies.
Thus, Buyer pays Funding Societies as per approved terms.

Non-notified (applicable to AR Financing only) :
Buyers are not notified of the arrangement between Seller and Funding Societies.
Thus, Buyer pays Seller as per invoice terms, then, Seller pays Funding Societies as per approved terms.

With Funding Societies Invoice Financing, you can apply for a financing tenure of up to 120 days. 

Depending on the nature of your business and its trade cycle, you have the option to apply for a tenure of 30, 60, 90, or 120 days.

If this is your first time with us, here is a run-through on the application process.

1. Complete the application form.

2. Prepare the following documents to support your application:

• Company Registration Forms

• Copy of all Director(s) NRIC/Passport

• Latest 6-months Bank Statement

• Latest Audited Accounts & Management Accounts (if available)
   

We will reach out to you shortly after your application.
Should there be a need for additional documents/information, we will request those accordingly.

Just like any other financing product, the following fees/charges will be applicable:

Accounts Payable Financing/-i

• Application / Registration Fee
  For Conventional & Islamic: RM50 per supplier or debtor.
  
  
• Facility Fee/ Up-Limit Fee
  For Conventional & Islamic: Up to 1% of the approved/increased limit of the financing facility (applicable for revolving only).
  
  
• Utilisation Fee/ Drawdown Fee
  For Conventional & Islamic: Up to 2% per drawdown (to be deducted from total disbursement amount)

Accounts Receivable Financing/-i

• Application / Registration Fee
  For Conventional & Islamic:RM50 per debtor.
  
  
• Facility Fee/ Up-Limit Fee
  For Conventional & Islamic: Up to 1% of the approved/increased limit of the financing facility (applicable for revolving only).
  
  
• Utilisation Fee/ Drawdown Fee
  For Conventional & Islamic: Up to 2% per drawdown (to be deducted from total disbursement amount.)

Please take note that the above are the common fees/charges of Invoice Financing/-i which serves as a guide, varying from product to product and subject to change from time to time.

For more accurate and updated fees/charges, kindly check with us. 

If you are late in making your repayments, the following fees/charges will be imposed: 

• Late Penalty Fee: RM 250 per 7 calendar day

• Late Interest Fee: Up to 0.1% per day (non-compounded) on the amount in arrears

Of course! If you choose to settle the financing early, there are NO fees or charges imposed!

The Shariah principle used is Commodity Murabahah via Tawarruq arrangement. Tawarruq refers to purchasing of Shariah compliant Commodity with deferred price, then selling it to a third party to obtain cash.

Any businesses whose principal activities are Shariah compliant (e.g. not related to tobacco, liquor, gambling etc.) can apply for the financing.

Funding Societies will be conducting Shariah screening to ensure proceeds to be raised are utilised for general working capital requirements and business purposes of the issuer which are Shariah compliant.