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ASBFEO Praises Greensill SCF Example

ASBFEO Praises Greensill SCF Example

(14 August 2020 – Australia) The Australian Small Business and Family Enterprise Ombudsman (ABSFEO) has welcomed Greensill’s move to sever client engagements exhibiting prohibitive payment terms.

Ombudsman Kate Carnell is calling on other supply chain finance (SCF) providers to follow the group’s example. Greensill has issued discontinuance notices to its SCF clients who fail to comply with 30 day payment terms.

As outlined in the ASBFEO’s Supply Chain Finance Review, the ombudsman notes that there are large companies extending their payment terms to 60 plus days from the end of month the invoice is lodged and offering SCF to those that want to be paid earlier and are willing to take a discount on the invoiced amount. This practice is unacceptable and harmful to small businesses, especially in the current difficult trading conditions.

“This is strong action taken in response to our Supply Chain Finance Review, showing that Greensill takes prompt payment times to small business seriously. There is no reason why other supply chain finance providers can’t do the same. Now, more than ever before, small businesses need to be paid the full invoiced amount owed, on time. Their survival depends on it” stated Ms Carnell.

“That’s why my office has recommended federal legislation requiring small businesses to be paid in 30 days. It is the only way to drive meaningful change in business payment performance across the economy. Greensill has shown that supply chain finance providers can lead by example by cutting off clients that fail to pay on time. This should be the position adopted by all supply chain finance facilitators” Ms Carnell added.

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