Supply chain finance vs invoice finance

2 min read

Buyer-ledSupply chain finance

Supplier-ledInvoice finance

Whose creditThe key difference

Two sides of the same trade

Supply chain finance (SCF) is arranged by the buyer: a financier pays the buyer's suppliers early, drawing on the buyer's stronger credit, while the buyer settles later. Invoice finance is arranged by the supplier: you advance cash against invoices you have raised, based on your own and your customers' creditworthiness. SCF helps a large buyer support its suppliers; invoice finance helps a supplier fund itself. See supply chain finance and the invoice finance guide.

Which credit carries the deal

	Supply chain finance	Invoice finance
Arranged by	The buyer	The supplier
Relies on	The buyer's credit	Your and your customers' credit
Helps	Suppliers get paid early	You fund your own cash cycle
Setup	Buyer must run the programme	You arrange it directly

If you are a supplier to a large buyer that runs an SCF programme, it can be a cheap way to get paid early. If no such programme exists, invoice finance lets you fund yourself directly — you do not need your customer to arrange anything.

When neither fits, borrow directly

Both depend on your position in a supply chain and, for SCF, on a buyer running a programme. If neither applies, a short-term business loan or revolving line funds your cash cycle regardless, with no dependence on a buyer or your ledger.

The Credicorp view

If you cannot rely on a buyer's supply chain finance programme and would rather fund yourself directly, a Credicorp business loan or Credicorp Flex line covers your cash cycle on your own terms — no personal guarantee. Register to apply. Educational content, not financial advice.

Frequently asked questions

What is the difference between supply chain finance and invoice finance?

Supply chain finance is arranged by the buyer, who lets a financier pay suppliers early on the buyer's stronger credit. Invoice finance is arranged by the supplier, who advances cash against their own invoices. SCF supports suppliers via the buyer's credit; invoice finance funds a supplier directly.

Which is cheaper for a supplier?

If your large buyer runs a supply chain finance programme, it can be a cheap way to get paid early because it draws on the buyer's stronger credit. If no such programme exists, invoice finance lets you fund yourself directly, priced on your own and your customers' creditworthiness.

What if I can't access either?

If no buyer runs an SCF programme and invoice finance does not suit, a short-term business loan or revolving line funds your cash cycle regardless of your position in a supply chain, with no dependence on a buyer's programme or a charge over your ledger.