Commodity-based Inventory Financing

Key Benefits of Commodity Inventory Financing

• Lower Credit Requirements: Businesses qualify without a strong credit history.

• Increased Sales: Enables companies to sell more by funding additional inventory.

• Support for New Businesses: Asset-light businesses can obtain financing without traditional collateral.

• DeRISK Inventory Financing utilizes REPO transactions to fund companies globally that buy and sell commodity-based assets.

Advantages Over Other Financing Instruments

• Tailored Financial Solutions: Custom financing for producers, traders, and end-users.

• Market Volatility Mitigation: Hedging strategies help manage price fluctuations.

• Cash Flow Preservation & Flexibility: Revolving financing helps maintain liquidity.

How does Inventory Financing work?

• Inventory serves as collateral for the financial instrument.

• Inventory financing helps businesses pay suppliers for stock that will be stored or transported.

• Useful for managing seasonal cash flow fluctuations.

• REPO (Repurchase) agreements: the lender buys the asset from the borrower and sells it back at the same price + interest. This helps secure the collateral legally, while making it at available to the company at arm's length transaction.

• Third-party warehousing & shipping is used to ensure security and facilitate financing globally.

Summary

• Applicable for businesses of all sizes that need alternatives to factoring, unsecured credit, or asset-backed loans.

• Solutions helps manage operational costs, seasonal demand, and product availability.

• Commodities loans or financing is secured by the purchased inventory.

• Your business can maintain cash flow, increase inventory availability, and supports business growth.

What Is Commodity Inventory Financing?

Improving cash flows to grow business

Inventory and commodity purchases are typically a major cash freeze for companies. We help them fund commodity-based inventory purchases buy directly purchasing the commodity while its being delivered to the warehouse or port. The client is required to buy-out the commodity from us before using it its later business cycle.