Scope & flexible application

Introduction

SME’s encounter many difficulties in the current economic phase to attract funding. Several developments (retracting movement of banks, stricter requirements on loans, adverse payment conditions) contribute to the situation. SME’s also lag behind with concern to the quality level and timeliness of information so that risks cannot well be determined by lenders at reasonable cost.

Asset Based Finance of accounts receivable:
The IHF-credit within the YCS format

  • A local Financing Company from the network of independent YCS Financing Companies, depending on its product-market combination focus, services selected SME’s that comply with a number of pre-set conditions.
  • Conditions to apply for an IHF-credit © may include a minimum of 100 invoices per month, Euro 3,5 million turn-over and 80 active debtors that are sent out by the SME to clients. An extra criterion may be an acceptable amount of spread amongst the debtors. Other criteria will determine the specific market interest of the local Financing Company like on geographical grounds or sector focus.
  • Linking the client company accounts to the software system of the YCS platform the possibility to track incoming payments in full is created.
  • Due to the structure, invoices acquire the feature of tangible collateral for funding parties, partly based on their continuous stream: accounts receivable financing (the underlying invoices) becomes in this structure, thus, “asset-based”.
  • The YCS Platform factually carries out the credit system. Protocols and algorithms secure that the funder of the loans and the payment account providers are independently linked, offering the credit services in a predictable, smooth and unbiased way.
  • A local Financing Company from the network of independent YCS Financing Companies, depending on its product-market combination focus, services selected SME’s that comply with a number of pre-set conditions.
  • Conditions to apply for an IHF-credit © may include a minimum of 40- 80 invoices per month that should be sent out by the SME to clients. An extra criterion may be an acceptable amount of spread amongst the debtors. Other criteria will determine the specific market interest of the local Financing Company like on geographical grounds, risk-return focus or sector focus.
  • Linking the client company accounts to the software system of the YCS platform the possibility to track incoming payments in full is created.
  • Due to the structure, invoices acquire the feature of tangible collateral for funding parties, partly based on their continuous stream: accounts receivable financing (actually the underlying invoices) becomes in this structure, thus, “asset-based”.
  • The central funding structure (the central financing vehicle that leverages the local Financing Company up to 4 times) will provide leveraged financing on the basis of certain governance conditions.