IFC and SMBC Launch $500m Facility to Help Small Suppliers Get Paid Faster

IFC, the World Bank Group member focused on private sector development, is committing up to $250 million in direct funding, with SMBC contributing the other half on equal terms.

Small businesses in emerging markets could gain faster access to money tied up in unpaid invoices through a new $500 million supply chain finance facility announced by the International Finance Corporation (IFC) and SMBC. The partnership will provide affordable working capital to suppliers, helping them manage everyday expenses, build financial resilience and support employment in the communities where they operate.

IFC, the World Bank Group member focused on private sector development, is committing up to $250 million in direct funding, with SMBC contributing the other half on equal terms. A large food manufacturer in Latin America is the first anchor buyer joining the facility, which has been designed to accommodate additional buyers across different industries and markets.

Large Buyers' Financial Strength Unlocks Earlier Payments

The facility bases financing on the creditworthiness of established buyers, giving smaller suppliers access to rates they could struggle to obtain through their own borrowing. Once a buyer approves an invoice, participating suppliers can receive early payment within days, turning money owed to them into working capital available for their business needs.

For a smaller company, the wait between delivering goods and receiving payment can put pressure on cash needed for wages, materials and other operating expenses. Linking financing to the buyer's financial strength gives suppliers, many of them small and medium-sized enterprises, a route to earlier payment on more affordable terms, helping them maintain operations and plan with greater confidence.

Direct Funding Expands the Reach of Supplier Finance

IFC's funded participation adds credit capacity that allows SMBC to finance a broader range of suppliers, offer longer financing periods and support higher transaction volumes than would be commercially viable without a development finance partner. The arrangement gives the bank greater scope to reach businesses that face difficulties securing working capital through existing market options.

Nathalie Louat, IFC's Global Director for Trade and Supply Chain Finance, described supplier finance as an effective way to deliver working capital quickly, affordably and at scale, connecting established buyers' creditworthiness with smaller businesses' financing needs. SMBC's Global Head of Sales for Global Trade Finance, Priyamvada Singh, linked the partnership to stronger supply chains, explaining that better liquidity management can support business growth and contribute to the stability and efficiency of global trade.

A Transaction History Can Open Doors to Broader Banking

The financing gap facing micro, small and medium-sized enterprises in emerging markets runs into trillions of dollars, limiting investment, expansion and job creation. Many businesses struggle to enter formal banking because they lack a documented financial history, even when their underlying operations could support access to credit.

Regular, verifiable transactions through the facility can help suppliers build that missing record, creating financial credentials that could support access to broader banking services over time. Faster invoice payments provide immediate liquidity, with the resulting transaction history offering a potential route towards lasting financial inclusion and stronger resilience.

The facility was structured through IFC's Global Supply Chain Finance program, which the announcement says has supported more than $3.8 billion in supplier finance transactions since its 2023 launch. Starting with the Latin American food manufacturer, the partnership provides a model for extending affordable working capital to more suppliers across sectors and emerging markets.