Invoice Discounting & Corporate FDs

Invoice Discounting

Invoice discounting is a form of short-term borrowing often used by businesses to improve their working capital and cash flow. Investors can participate by funding these invoices through specialized platforms. Essentially, you are lending money against unpaid invoices raised by businesses (sellers) to reputable corporations (buyers), expecting repayment once the buyer pays the invoice.

Short Tenure: Investments typically range from 30 to 120 days, aligned with invoice payment cycles.
Potentially Higher Yields: Often provides higher returns compared to traditional FDs or liquid funds due to the associated risks.
Risk Factor: The primary risk is the delay or default in payment by the buyer of the goods/services (the corporate debtor). Due diligence on the platform and the underlying corporates is essential.

Our Invoice Discounting Services

Curated Deal Listing: Showcasing selected invoice discounting opportunities from our partner platforms (e.g., KredX, TradeCred - Placeholder).
Risk Level Indicator: Providing an indicative risk assessment based on the buyer's creditworthiness (where available).
Onboarding Helpdesk: Assisting new investors with the KYC and onboarding process on partner platforms.

Corporate Fixed Deposits (Corporate FDs)

Corporate FDs are fixed deposit schemes offered by companies (including NBFCs and Housing Finance Companies) directly to the public. They function similarly to bank FDs but typically offer slightly higher interest rates.

Higher Interest Rates: Generally offer better rates than bank FDs for similar tenures.
Fixed Returns: Interest rate is fixed at the time of investment for the chosen tenure.
Credit Risk: Unlike bank FDs (which are insured up to 5 Lakhs by DICGC), corporate FDs carry credit risk associated with the issuing company. Higher-rated companies (AAA, AA) are considered safer.
Liquidity: Premature withdrawal options might be available but often come with penalties.

Investment Considerations

Both invoice discounting and corporate FDs offer potential for higher fixed income but come with higher risks than traditional bank deposits. Thorough assessment of the platform/company's credibility, credit ratings (for FDs), and the underlying businesses/invoices (for discounting) is crucial. These are suitable for investors with a moderate to high-risk appetite seeking portfolio diversification.