Payables Financing  Payables Financing, also known as Accounts Payable Financing or Reverse Factoring, is a financial arrangement where a third-party lender pays a company’s suppliers on its behalf, often at a discounted rate, in exchange for extended payment terms from the company. Here’s how it works: 

• A company orders goods/services from suppliers. 

• The supplier invoices the company. 

• The finance provider pays the supplier early (often at a discount). 

• The company repays the finance provider later, on agreed terms. 

This type of financing improves supplier cash flow while allowing the buyer to extend its payment cycle without damaging supplier relationships. It’s particularly useful for businesses managing tight cash flows or looking to optimize working capital without increasing debt.