Market environment, receivables finance, trend topic ESG

July 2022

Companies are currently facing numerous challenges: the consequences of the Corona pandemic, persistent supply bottlenecks, the energy crisis caused by the Ukraine war as well as high inflation rates in combination with rising interest rates that also impact currency rates and import/export costs.

The uncertain and turbulent market environment is changing the corporate finance landscape fundamentally, especially through rising financing costs. This also applies for working capital finance. A strong financing mix and sufficient liquidity are therefore essential for companies to ensure business continuity and finance growth even in challenging times. Working capital financing instruments such as supply chain finance or factoring remain important elements in this context.

Companies are looking for reliable and sustainable financing that not only fits their strategy, growth path, investment plans and culture, but is also measurably ESG-compliant. Driven by the continuous digitalization, financing processes should also be transparent, automated, and scalable.

CRX Markets is facing high demand in receivables finance requests during recent months. To understand company specific requirements and intentions such as liquidity optimization or risk mitigation, CRX Markets conducts comprehensive analyses for interested companies to structure tailor-made solutions in different regions, jurisdictions, and currencies. On the CRX Marketplace, both individual debtors or entire portfolios can be sold without recourse to a broad and international network of financing partners. Unlike traditional factoring providers, the CRX Marketplace has no or very low structuring fees. The digital platform can be used globally and customized to the corporate’s financing needs. For example, different funding partners can be integrated for different regions and currencies, e.g. banks A, B and C are selected for financing in Europe, banks D, E and F for financing in the USA, to achieve best and competitive pricing. Global scalability via the marketplace is ensured, whereas classic factoring providers often have a regional focus, e.g., are only active in one country or jurisdiction. Furthermore, CRX Markets offers flexible receivables financing without an obligation to sale. Based on an allocation algorithm, CRX Markets’ corporates receive the best market price for their receivables at any given time. The financing parties are freely selectable and, depending on the structure, compete or cooperate as similar to a syndicated loan. The structure can be adapted and further scaled if desired, for example if additional jurisdictions, new countries, funding partners or debtors should be added. With over 50 financing partners, CRX Markets ensures a diversified and global funding coverage, regardless of jurisdictions and currencies.

The trending topic ESG is also reflected on the CRX Marketplace. CRX Markets offers clients the possibility to add relevant ESG ratings, metrics, or certificates to their invoices on our portal, thereby benefiting from better financing conditions. Already in April 2020, CRX Markets executed the first sustainable supply chain finance (SSCF) transaction in the DACH region together with Nestlé. The integration of ESG components in receivables financing is already planned for 2022 due to high market demand. The CRX Marketplace is agnostic and allows the integration of all ESG ratings, KPIs or certificates requested by corporates. Since 2022, CRX Markets has been cooperating with EcoVadis, the global provider of universal and robust sustainability ratings for companies and their global value chains.