CRX Marketplace requirements for a coherent user experience

January 2022

A marketplace must – generally speaking – meet the requirements of all its participants. Due to the complexity of the regulatory framework and, as a result, the processes involved, this is a particular challenge for a marketplace for working capital financing.

The accounting view

Since a working capital finance marketplace orchestrates payment flows against receivables and payables, and every receivable and payable has two sides, a supplier and a customer, the internal data structures of the marketplace must match the data structures of the participants in their ERP systems on both sides. Often, these two views do not coincide, and just as often, neither of these views corresponds to the legal view. Here are two examples to illustrate the problem:

  • If, in the context of financing, a marketplace were to offset credit notes and invoices that are legally assigned to the same supplier, but technically belong to different vendors in the customer’s or buyer’s ERP system, this offsetting would not take place in the payment run and there would be overpayments to the suppliers – followed by underpayments as soon as the credit notes were actually deducted.

  • If a marketplace were to bundle invoices into one payment that are legally assigned to the same buying company but technically belong to different customers in the supplier’s ERP system, the supplier would have considerable difficulty in offsetting its open items in different customer accounts against this one payment.

The legal view

As significant as this accounting consideration is for the orchestration of payment flows, it is insignificant for the legal consideration in the context of regulation (e.g., know your customer processes) and risk management of financing partners (credit lines, pricing, etc.). These legal structures must be mapped in addition to the accounting structures, which means that it must be possible any time to trace which legal entity triggers a payment and which is the beneficiary of the payment.

Organizational structures and access protection mechanisms

The users of a marketplace are employees of a company. This means that the user and role concept of the marketplace must be adaptable in order to comply with the data protection regulations of the participating companies and still enable flexible operation of the marketplace.

Network effects

As the marketplace grows, multidimensional structures increase thanks to network effects, so their complexity must be mapped. The following structures are possible:

  • Suppliers participating in multiple reverse factoring programs
  • Suppliers participating in reverse factoring programs, but also operating their own factoring program in parallel
  • Suppliers participating in many reverse factoring programs and operating their own factoring program, and at the same time are acting as customers of other suppliers in a supply chain, operating their own reverse factoring program for them

A cohesive user experience

Despite a challenging and complex environment, we work every day to provide the best possible coherent and professional user experience for CRX Marketplace users. Even though the processes in the backend are extremely complex, all applications located in the frontend should be simple, transparent and comprehensible for the user. We are driven by the vision of an intuitive "One Stop Shop" or a "One Portal". A user can manage all his programs with just one login and track the status of his invoices and when he can expect to receive payments. In the coming year, we will continue to drive our vision and continuously improve our customers’ user experience when interacting with CRX Markets.

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