Vendor Financing

Special credit facilities for (large corporate) vendors

Vendor Financing

About Vendor Financing

HDFC Banks extends finance and credit facilities to vendors of large corporations. The bank provides credit to vendors through working capital loans, bill discounting and structured finance against confirmed orders from their customers.

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Bill Discounting

HDFC Bank’s specialist trade finance team offers vendors bill discounting services, backed by a nationwide network of branches and correspondent banks. The services are customised to suit vendors’ need for short term finance, from sale to payment. As a vendor, you can get:

  • Short-term unsecured finance
  • Credit of up to 90 days for sale of goods to corporates
  • Self-liquidating
  • Get funding against acceptance by corporates
  • Credit line is based on financials of vendor
  • Minimal documentation

Structured Purchase Order Financing

Structure PO Financing means HDFC Bank pays for the cost of your goods directly to your supplier and frees up your cash for other critical business expenses.

  • Funding provided for 45 to 90 days against confirmed purchase orders from select customers
  • Limits based on working capital cycle to execute the order. Up to 70% of the value of the purchase order is funded upfront
  • Facility to be liquidated from the cash flows accruing from the execution of the order, i.e. through bill discounting or through invoice financing
  • Commitment from purchasing corporate to route all payments through HDFC Bank
  • Minimal documentation

Mortgage-Backed Term Loans

HDFC Bank’s commercial mortgages make owning, refinancing, or renovating commercial real estate easy and affordable. Vendors can also use these loans for working capital.

  • Term loans provided for expansion and setting up of additional capacity for select vendors
  • Tenors up to 5 years
  • Limits based on financial projections, acceptable DSCR and committed long-term contracts for sale with corporates
  • Up to 75% of the project cost would be funded. Balance to be promoter's contribution
  • Facilities to be secured by assets being financed. Collateral security may be obtained in certain cases
  • Minimal documentation

Working Capital Facilities

HDFC Bank’s Working Capital Finance helps vendors meet their cash flow requirements.

  • HDFC Bank extends working capital facilities through cash credit, WCDL, LCs, guarantees and export credit to select vendors of corporates
  • Credit is provided based on analysis of financials, need for funding, regulatory guidelines and security. Cash flows from major customers may need to be escrowed
  • Funding is provided against hypothecation of stocks and book debts with a minimum margin of 25%. Collateral security may be taken in specific cases
  • Minimal documentation