# Supply Chain Finance

*Last updated: 2026-06-22*

> Banks, fintechs, and dedicated trade platforms use Supply Chain Finance (SCF) to close the liquidity gap that arises when suppliers need early payment but buyers want to extend their terms.

Banks, fintechs, and dedicated trade platforms use Supply Chain Finance (SCF) to close the liquidity gap that arises when suppliers need early payment but buyers want to extend their terms. A financial intermediary advances the invoice amount to the supplier at a discount, then collects the full sum from the buyer at the agreed later date. Both parties improve their working capital position without renegotiating commercial terms. SCF is especially prevalent in cross-border trade, where long production lead times tie up significant capital in transit. It differs from classic factoring – where receivables are sold without the buyer's involvement – and from letters of credit, which provide payment security rather than accelerate liquidity.

**Source:** [https://en.wikipedia.org/wiki/Supply_chain_finance](https://en.wikipedia.org/wiki/Supply_chain_finance)

## Quick Facts

| Property | Value |
|---|---|
| Term | Supply Chain Finance |
| Language | EN |
| Word count | 113 |
| Last updated | 2026-06-22 |
| Source | https://en.wikipedia.org/wiki/Supply_chain_finance |

---

*Logistics Glossary — Freight Academy: [https://www.freight-academy.com/en/glossary/supply-chain-finance](https://www.freight-academy.com/en/glossary/supply-chain-finance)*

*Markdown mirror: [https://www.freight-academy.com/api/md/glossary/en/supply-chain-finance](https://www.freight-academy.com/api/md/glossary/en/supply-chain-finance)*

*JSON summary: [https://www.freight-academy.com/api/v1/glossary/supply-chain-finance/llm-summary?lang=en](https://www.freight-academy.com/api/v1/glossary/supply-chain-finance/llm-summary?lang=en)*