Notice. This page is informational and general in nature. Purchase order financing remains subject to counterparty acceptability, KYC and AML, sanctions screening, collateral verification, definitive documentation, and third-party approvals. FG Capital Advisors acts as an arranger and advisor and is not a bank or lender. We do not accept client money. No approval, pricing, or timeline is guaranteed.
Purchase Order Financing
Purchase order financing bridges the timing gap between supplier settlement and buyer payment. It funds documented supplier costs before shipment, with repayment sourced from controlled customer collections after delivery.
FG Capital Advisors arranges purchase order financing with suitable third-party capital providers. We build the lender-ready file, structure the funds flow, and manage the term sheet workflow through closing.
Request a ProposalWhat Purchase Order Financing Covers
Purchase order financing is used to fund supplier costs tied to a specific customer order. Funding is typically applied to supplier invoices, manufacturing milestones, inspection and logistics costs, and other documented inputs required to deliver goods in line with the buyer contract.
Related internal pages: Trade Finance for SMEs , Trade Credit Financing , and Structured Trade Finance Advisory Services.
Typical Transaction Profile
| Dimension | What Providers Prefer | Why It Matters |
|---|---|---|
| Buyer | Creditworthy payor with consistent payment behavior and clear acceptance mechanics | Repayment is sourced from buyer collections |
| Goods and acceptance | Well-specified goods with objective inspection and delivery evidence | Reduces disputes and payment delays |
| Supply chain | Auditable supplier invoices and a verifiable production and shipment plan | Funding is advanced against execution milestones |
| Margin | Sufficient gross margin to absorb fees and timing variance | Thin margins often fail underwriting |
| Cycle time | Short and predictable order-to-cash timeline | Time outstanding drives economics and risk |
If the supplier requires deposits or full prepayment, see: SBLC and APG Prepayments for Suppliers.
How the Facility Operates
Providers focus on traceability of inputs, documentary evidence of performance, and controlled collections for repayment. The structure is designed so repayment is operational, not discretionary.
| Step | Workstream | Provider Control Point |
|---|---|---|
| 1) Order validation | Confirm buyer terms, acceptance tests, delivery timing, and payment triggers | Buyer credit review and dispute mechanics mapped |
| 2) Supply plan validation | Confirm supplier capability, quote, lead times, inspection regime, and shipping plan | Milestones and evidence requirements defined |
| 3) Funding and disbursement | Disbursements made to suppliers or controlled payees, typically staged | Direct pay, holdbacks, and documentary draw conditions |
| 4) Shipment and invoicing | Goods ship under agreed documentation and the buyer invoice is raised | Shipping and inspection evidence captured |
| 5) Collections and repayment | Buyer pays into a controlled account or the invoice is taken out via receivables finance | Cash waterfall with provider paid first |
Controls Commonly Required
- Assignment of proceeds. Buyer payments directed into an agreed collections path.
- Documentary discipline. Shipping and acceptance evidence maintained in an audit-ready file.
- Funds-flow controls. Direct payment to suppliers and staged disbursement against milestones.
- Cash control. Controlled accounts and repayment waterfall.
- Collateral visibility. Where applicable, inventory and logistics controls supported by third parties.
Related internal pages: Collateral Management Agreements in Trade Finance and Trade Finance Bridge Loans.
What We Deliver as Arranger
Our mandate is to make the transaction decision-ready: a lender-grade package, clean controls, and a managed process to written outcomes.
- Structure and funds-flow map. Disbursements, evidence triggers, shipment path, and collections design.
- Lender-ready package. Buyer profile, supplier plan, economics, documentation map, and risk allocation summary.
- Targeted placement. Provider selection aligned to buyer, goods, jurisdictions, and control stack.
- Execution coordination. Q&A management, term sheet support, and closing workstream coordination.
Explore our broader trade finance coverage: Trade Finance Consulting and Trade and Commodity Finance Investment Banking.
FAQ
Do you provide the funding?
No. FG Capital Advisors acts as an arranger and advisor. Funding decisions are made by third-party capital providers under their own underwriting and approvals.
Is a purchase order sufficient for approval?
A purchase order is an input, not a credit decision. Providers underwrite buyer credit quality, acceptance risk, supplier execution, margins, timeline, and enforceable controls.
Can purchase order financing be combined with receivables finance?
Yes. Pairing PO funding with a receivables takeout is common where it improves repayment certainty, subject to provider approvals and definitive documentation.
Do you guarantee approval, pricing, or timelines?
No. Work is best-efforts and subject to diligence, compliance screening, definitive documentation, and third-party approvals.
Request a proposal to arrange purchase order financing. Submit buyer terms, supplier quote, goods description, expected delivery timeline, and order economics. If cross-border, include Incoterms and shipping route.
Request a ProposalDisclosure. This content is for informational purposes and does not constitute legal, tax, accounting, or financial advice. FG Capital Advisors is not a bank or lender and does not accept client money. Any support is provided on a best-efforts basis and remains subject to third-party approvals, diligence, compliance checks, and definitive documentation. No funding, pricing, or timeline is guaranteed.
