Solar Supply Chain Finance
Designed to meet the needs of PV manufacturers, EPCs, solar project developers, and solar-plus-storage companies, our innovative solar supply chain financing platform offers the flexibility required to lower costs, unlock value and accelerate growth. By leveraging Targray Group’s robust financing facility and decades-long partnerships with leading solar manufacturers, we’re able to create valuable procurement solutions backed by flexible terms not offered through other suppliers or banks.
Solar SCF Buyer Benefits
- Extends payment terms on PV material or solar panel purchases.
- Enhances cash flow by freeing up cash that would otherwise be locked in the supply chain.
- Provides buyer with more working capital to invest in other important initiatives.
- Improves several financial metrics without impacting balance sheet.
Solar SCF Supplier Benefits
- Enhances cash flow through accelerated payment on receivables.
- Mitigates the effect of payment term extensions to buyers.
- Optimizes working capital, enabling other strategic investments to be made.
- Lower fees than other financing approaches as rates are based on buyer’s credit history and rating.
- No impact on balance sheet as no lending occurs.
Solar SCF Process Flow
Targray’s Solar SCF program can be initiated by either the buyer or the supplier. In the first scenario, the buyer uses our program to extend payment terms with some or all of its suppliers. In the second scenario, the supplier proposes our Solar SCF solution to get paid early. In both scenarios, the transaction is carried out as follows:
- SCF request is initiated by either party.
- Targray evaluates the request, proposes a credit limit and terms.
- Buyer uses Targray SCF to purchase materials from supplier. (Targray becomes transacting party)
- Buyer receives materials in a timely manner – the supplier is paid early.
- Buyer pays Targray according to agreed SCF terms; Flexible open terms or long-term LC.
What is Supply Chain Finance?
Supply chain finance (SCF) – alternatively described as supplier finance or reverse factoring – is a solution that enables businesses to increase supplier payment terms while allowing them to get paid early. SCF effectively frees up cash in that would otherwise be locked in the supply chain.
Supply chain finance is an extension of the buyer’s accounts payable, hence it is not considered a financial debt. For the supplier, it represents a non-recourse sale of receivables. The balance sheets of both buyers and suppliers are not impacted by SCF transactions, as no lending occurs on either side of the equation.
Targray’s Solar SCF program is designed to create a win-win situation for both buyers and their suppliers. The buyer optimizes working capital through extended payment terms, while the supplier generates additional cash flow through accelerated payment.
About Targray Solar
Targray Solar’s PV materials and supply chain solutions are a trusted source for the world’s leading photovoltaics manufacturers, solar project developers, EPCs, contractors and installers. Since 2005, the company’s procurement programs have played an important part in making solar energy a viable alternative to traditional energy sources. Our mono, multi and bi-facial solar cells, solar modules, and other PV material programs help solar panel manufacturers, distributors, and developers lower the cost-per-watt their solar solutions can deliver to end-users.
Working alongside our manufacturing partners and organizations including Solar Energy Industries Association (SEIA) and American Solar Energy Society (ASES), the Solar Division is committed to helping accelerate the growth of solar energy worldwide. Contact us today to learn more about our solar SCF solution or to determine your company’s program eligibility.