GLOSSARY
Approved Payables Finance
Synonym for reverse factoring: a buyer-led SCF programme where a third-party funder pays approved supplier invoices early at the buyer's credit rate.
Approved payables finance is the bank/treasury name for what the supplier side calls reverse factoring. The buyer approves an invoice, a partner funder offers the supplier early payment at a discount priced off the buyer's credit, and the buyer settles with the funder at the original maturity.
Why it matters
The naming matters for accounting. Under the IFRS Disclosure Initiative on Supplier Finance Arrangements (effective 2024) and equivalent FASB guidance, approved-payables programmes have specific disclosure requirements distinct from regular trade payables — material for credit analysts, auditors, and the supplier deciding whether to opt in.
Related terms
- Reverse Factoring
- Supply Chain Finance
- Dynamic Discounting