CHAPTER 2

AN INTRODUCTION TOCHANNEL FINANCING

2.1 Introduction

As discussed in the earlier chapter, working capital managementis critical for all business firms. To improve the position of workingcapital, several techniques and ways have earlier been used by thecompanies with an objective of maintaining optimum level of workingcapital like enforced Days Payable Outstanding extension i.e. extendingpayment terms to suppliers and enforced Days Sales Outstanding reductioni.e. enforcing small customers to pay early. (1) But these techniques tendto view working capital enhancement from a single perspective and thefocus is only on their individual financial issues rather thanunderstanding the bigger and wider picture. Longer payment terms tosuppliers are likely to affect adversely the commercial relationship aswell as the working capital position of supplier firms, resulting in unstableand financially unsound supplier base. At the same time a small, lesspowerful buyer may face the liquidity constrains if he is forced to payearly. This shifting of financial burden from one party to another addssignificant risk to the supply chain. Strapped for cash and lackingadequate access to affordable capital, suppliers may be forced to delay rawmaterial ordering, squeeze work-in-process inventories, or skip theirplant maintenance or quality processes.

(1) Eric Hofman and Oliver Belin, Supply Chain Finance Solutions - Relevance,Propositions, Market Value, Springer Heidelberg Dordrecht Publication,London, New York, 2011; Pg. No. 10

CHAPTER 2

AN INTRODUCTION TO CHANNEL FINANCING

(38)

This can trigger downstream delays and quality issues for the buyer,including expensive manufacturing line shutdowns and late order executionof critical customers. To stay in business, suppliers are eventually forcedto bury the cost of extended payment terms in the cost of goods sold. Thusover the long term, cost-shifting to suppliers will result in an overall highercost of goods sold. In recognition of the contribution and the vast potentialof the small suppliers as well as their inherent infirmities, provision ofadequate credit to this sector has become a crucial element of a supplychain.

With the recent credit crisis, large companies are seeing their supplychains threatened by lack of liquidity. With competition no longer amongindividual companies but among the entire supply chains, the big corporatefirms are exploring every area of end-to-end cost reduction. Therefore theyneed a financial solution that could help them to make their entire supplychain more stable and competitive.

In an attempt to address these challenges, the approach of ChannelFinancing has become more prevalent.

But before discussing to the concept of Channel Financing, theresearcher strongly felt the need to understand and elaborate the conceptof “supply chain”.

2.2 Meaning and definitions of supply chain

The Original Equipment Manufacturers need the raw material toproduce finished goods. So they purchase this raw material from theirsuppliers/vendors. The Original Equipment Manufacturer produce and

(39)

sell the finished goods to dealers/distributors who sell these goods toretailers. The retailers sell the goods to final consumers. This network startingfrom vendor/supplier to consumer is called as “Supply Chain”. Thus asupply chain not only includes the Original Equipment Manufacturer andsuppliers, but also includes transporters, warehouses, retailers, after salesservice providers and customers themselves. The range of activities thatencompass the supply chain include procurement of inputs, manufacturing,assembling, transportation to warehouse, from warehouse to retail outletand finally transportation from retail outlet to the ultimate customer.

Diagram showing concept of supply chain

Source : www.indmedica.com

(40)

From the above diagram it is clear that a supply chain is a networkof organizations that are involved through upstream and downstreamlinkages in different processes and activities that produce value in theform of products and services. It consists of all stages involved, directlyor indirectly, in fulfilling a customer demand. A supply chain is a systemof organizations, people, technology, activities, information and resourcesinvolved in moving a product or service from vendors to end users. Thenetwork of a supply chain is called as ‘channel’ or ‘passage way’ becausethe raw material passes through various stages and ultimately reachesconsumers. And each participant of this channel i.e. supplier, retailer,transporter etc. is called as ‘Channel Partner’.

A typical supply chain is consists of three different sets of activities:

l In-bound logistics :

It is also known as Procurement logistics. In this stage the vendor/supplier and Original Equipment Manufacturer interact with each other. Itconsists of activities such as market research, requirements planning, makeor buy decisions, supplier management, ordering, and order controlling.The in-bound logistics activities are related to - maximizing the efficiencyby concentrating on core competences, outsourcing while maintaining theautonomy of the company, and minimization of procurement costs whilemaximizing the security within the supply process.

l In-plant logistics :

It is also known as Production logistics. In this stage the OriginalEquipment manufacturer converts the raw material in finished product. It

(41)

connects in-bound logistics to out-bound logistics. The main function of in-plant logistics is to use the available production capacities to produce theproducts needed in out-bound logistics. In-plant logistics activities are relatedto organizational concepts, layout planning, production planning, and control.

l Out-bound logistics :

It is also known as Distribution logistics. In this stage the OriginalEquipment Manufacturer and dealer/distributor interact with each other.It has the main task of the delivery of the finished products to the customer.It consists of order processing, warehousing, and transportation. Out-boundlogistics is necessary because the time, place, and quantity of productiondiffer with the time, place, and quantity of consumption.

Definitions of supply chain

A supply chain is the entire network of entities, directly or indirectlyinterlinked and interdependent in serving the same customer or set ofcustomers.

Handfield and Nichols Jr, distinguished professors of Supply ChainManagement have defined supply chain as, “The supply chain encompassesall organizations and activities associated with the flow and transformationof goods from raw materials stage through to the end user as well asassociated information flow.” (2)

2. Handfield and Nichols Jr., Supply Chain Redesign, Pearson Education Pvt.Ltd., Delhi, 2003, Page No. 8

(42)

According to D. K. Agrawal, “supply chain is a process whichinterfaces and interacts within the entire company and with externalorganizations like vendors, carriers, dealers etc. It is responsible for themovement of products from vendors to customers through manufacturingfacilities, warehouses, and third parties such as transporters, repackagersetc.”(3)

A customer is an integral part of the supply chain. The ultimatepurpose of the existence of any supply chain is to satisfy customer’sneeds and requirements, in the process generating profits for itself. Sothe activities of supply chain begin with a customer order and endwhen a satisfied customer has paid for the purchase. The concept ofsupply chain looks simple and uncomplicated. But in reality when anOriginal Equipment Manufacturer typically purchases thousands ofproducts from hundreds of suppliers and distributes the finished productthrough another large set of distributors, things become quite intricateand complex.

A supply chain works as a cohesive single unit. It is equivalentto a relay race where there are different players running one after another.The first one hands the baton to the next player, who then tries to maintainand even improve upon the performance of earlier runner and passeson the benefits so derived to the next player. The race cannot be won bybest performance of one single player. (4)

3 D. K. Agrawal, Logistics and supply chain management, Macmillan IndiaLtd., New Delhi, 2007, page no. 54

4 Kulkarni and Sharma, Supply chain management – creating linkages forfaster business turnaround, , Tata Mcgrwhill publications, New Delhi, 2004

(43)

Competing successfully in any business environment requirescompanies today to become much more involved in how their suppliersand dealers do business. As global competition increases, making productsand services that customer want to buy means the business has to paycloser attention to where the materials come from, how their suppliersproduce products, how the finished goods are stored and transported etc.Reduced inventories, lower operating costs, product availability andcustomer satisfaction are all the benefits which grow out of an effectivesupply chain.

Today many firms are making a conscious decision to par down theorganization, to focus more on core capabilities while trying to create allianceor strategic partnerships with suppliers, transport and warehousingcompanies and distributors who are good at what they do.

This team approach to making and distributing products and servicesis becoming most effective and efficient way of doing business to staysuccessful.

Along the supply chain, there are three parallel flows

1. Flow of goods and services –

This encompasses the products and services that move between thesuppliers and buyers within supply chain. The following Figureshows the flow of material (“products and services”) from the sourceof materials forward (or upstream) to the final consumer in theexternal chain. It should be noted that there is also a backward (ordownstream) flow of materials, mainly associated with productreturns. The growing importance of reverse logistics in recent yearshas sharpened the focus on management of these flows.

(44)

2. Information flow -

Information associated with flow of goods and services and theirassociated payments also flows through the supply chain. As shownin the following Figure, information flows in the supply chain arebi-directional. The flow or movement of materials or money is usuallytriggered by an associated information movement. Effectivemanagement of material and money flows is, therefore, predicatedupon the effective management of the related information flows.

3. Financial flow –

This encompasses numerous invoices and payments between thechannel partners of supply chain. In a supply chain, money flowsfrom the ultimate consumer of the product back down through thechain. The timing of these flows is critical in ensuring that supplychain companies maintain the ability to meet their ongoing operationalexpenditure commitments.

Diagram showing three flows of supply chain

Source : www.iwarelogic.com

(45)

As seen in the above diagram, supply chain is a three-leggedstool- the first leg is product, the second is information, and the thirdis finance. It is dynamic and involves the constant flow of information,products and funds between the different stages. Each stage of supplychain performs different processes and interacts with other stages ofsupply chain. The term supply chain gives images of information, fundsand products flowing along both directions of this chain.

For the last decade or so, companies have been focusing significantresources on streamlining their supply chains. For the most part, this hasmeant the physical supply chain—as in the movement of goods around theworld. Less attention has been paid, however, to the financial side of supplychain management—the flow of money in support of the physical movements.Generally it is observed that goods and information move faster through asupply chain than finance. Companies are facing many challenges likeunreliable and unpredictable cash flows, slow processing of documents,delays in reconciliations, high Days Sales Outstanding etc as far as thefinancial flows of supply chain are concerned. If these challenges areaddressed, money saved can be shifted to more valuable uses.

To overcome these challenges, the concept of Channel Financing orSupply Chain Financing (SCF) begun to evolve.

2.3 What is Channel Financing ?

Here the researcher has felt the need of elaborating the process oftraditional bank financing before discussing the concept of ChannelFinancing.

(46)

Traditional Bank Financing :

In the first stage of supply chain, the Original EquipmentManufacturer purchases the raw material from vendor/supplier andwishes to avail credit from vendor to the maximum extent possible. Butat the same time the vendor wish to get the payment for material suppliedas early as possible from Original Equipment Manufacturer. So theOriginal Equipment Manufacturer approaches bank to finance for purchasesof raw material, avails the finance and pays off supplier.

In the second leg of supply chain the Original Equipment Manufacturerconverts the raw material into finished product.

In the third leg of supply chain, the Original Equipment Manufacturersells the products to dealers/distributors. The dealers wish to avail creditfrom Original Equipment Manufacturer to the maximum extent possible.The Original Equipment Manufacturer gives credit to dealer andapproaches banks for financing book debts/receivables.

This is nothing but traditional method of bank financing. Thetraditional bank financing can be explained with the help of followingdiagram (See next page) ... :

(47)

From above diagram it is clear that in traditional bank financingthe Original Equipment Manufacturer, in addition to core activities ofproduction and sale also undertakes the responsibility of taking financefrom bank, paying suppliers, giving credit to dealers and refinancing itfrom banks.

But why should an Original Equipment Manufacturer undertakethis activity and why not outsource the financing activity to other specialistlike bank and focus on core function of production and sales? (5)

5. Krishna Mahankali, Channel Financing, IBA Bulletin, Vol. xxv No. 5,May 2003, Page No. 14

Diagram showing Traditional Bank Financing

Bank

Vendor/Supplier

Raw Material

DealerOriginal

EquipmentManufacturer

Finished Goods

Payment PaymentFin

ance

(48)

Instead of an Original Equipment Manufacturer taking finance topay the raw materials suppliers, why not banks finance suppliers? And inthe same way, instead of Original Equipment Manufacturer giving creditand taking refinance from bank, why not banks give credit to thedealers?

The facility of Channel Financing is nothing but an answer tothis question.

Forward and backward linkages in a business organization play asignificant role in the success or failure of the business entity. For (say) amanufacturing or trading firm, while the suppliers of raw material areimportant as they provide input for production, equally important is therole of its distributors which sell products manufactured by the firm throughretailers to the ultimate consumer. Channel Financing relates to ensuringthat integrated financial and commercial solution is available to the entirechain of supply and distribution, which could improve the health of thefirm, financed by the bank.

The facility of Channel Financing provides an opportunity to collaborateand create benefits for each side of the transaction of supply chain andimprove the working capital.

Channel Financing, which is also known as ‘Supply Chain Financing’,is a relatively new concept in the field of working capital finance.

Being a sophisticated face of working capital finance, it is a flexiblemodel which uses the synergies of supply chain by financing workingcapital of dealer/distributor and supplier of big corporate house/OriginalEquipment Manufacturer so as to ease the flow of goods. It covers the

(49)

entire value chain in an organization right from supplier supplying thematerial to the final stage of distribution.(6)

Channel Finance represents solutions available for financing goodsas they move from origin to final destination along the supply chain. Ithelps the channel partners to grab the new opportunities and manage growthefficiently. The use of Channel Financing may help the channel partners totake up large projects that would otherwise have been unable to executedue to working capital constraints.

2.4 Definitions of Channel Financing

Channel Financing is typically defined as, “a combination of servicesand technology solutions that links buyers, suppliers, and finance providersto improve the visibility, financing cost, availability, and delivery of cashwhen supply chain events take place.” (7)

Tower Group, a leading research and consultancy firm having headoffice in USA defines Channel Financing as,” a category of solutions designedto provide working capital financing and accelerated cash inflow to supplierson the basis of the value of physical or financial supply chain events suchas issuance of a purchase order or approval of an invoice.” (8)

6. Shaveta Sharma, Supply Chain Finance – A Value Praposition, The CharteredAccountant, Vol 55 No. 11, May 2007, Page No. 1771

7. Supply Chain Finance : The Next Big Opportunity, By WilliamAtkinson Publication : Supply Chain Management Review Date :Tuesday, April 1 2008

8. So You Think You Understand Supply Chain Finance ? PublicationDate : July 11, 2007 Author / Source : Susan Feinberg, Research Director,Wholesale Banking, Tower Group (July 2007)

(50)

Aberdeen Group, a provider of fact-based  business intelligence research defines Supply Chain Finance (SCF)/Channel Finance as “acombination of Trade financing provided by a financial institution, athird-party vendor, or a corporation itself, and a technology platform thatunites trading partners and financial institutions electronically andprovides the financing triggers based on the occurrence of one or severalsupply chain events.” (9)

Being a facility of working capital finance, Channel Financing isabout managing cash flow between companies along the supply chaineither in form of a payment between vendor and a buyer or in the formof finance. It not only manages the flow of funds but also the flow ofinformation across the supply chain in form of documents like invoices,purchase orders, payment approval etc.

Under the facility of Channel Finance, the Original equipmentManufacturers provides working capital support to their chosen channelpartners at negotiated rate of interest through bank/financial institution. Itis different from traditional practice of standalone risk evaluation whichwas focused only on channel partners financial strength & historic financialperformance.

The Channel Finance solution works best when the OriginalEquipment Manufacturer has a favorable credit rating and can obtain alower cost of financing from the bank for their channel partners than thechannel partner’s traditional financing sources. The Channel Finance

9. Aberdeen Group, “Get Ahead with Supply Chain Finance: How to LeverageNew Solutions for End-to-End Financial Improvement,” July 21, 2006.

(51)

model is designed to support those channel partners that are closelyassociated, critical to the Original Equipment Manufacturer and havestrong business association.

The Original Equipment Manufacturers are large, creditworthyfirms that are of low credit risk. Compared to these large corporate,their channel partners are typically small, risky firms who generallycannot access easily any financing from the formal banking sector andeven if they get the access, the cost of credit is very high. The facility ofChannel Finance allows these channel partners to use their businessassociation with Original Equipment Manufacturers and get workingcapital financing at comparatively lower rate of interest by using thecredit worthiness of the large manufacturer. Thus Channel Financingenables the channel partners to effectively transfer their credit risk totheir high-quality customers and get an access to more and cheaperworking capital financing.

Being an innovative option for extending working capital finance itcovers :

l Discounting of trade bills drawn by manufacturer and accepted bydealer.

l Providing overdraft/cash credit facility to supplier against purchaseorder or specific purchase guarantee.

l Discounting of bills drawn by supplier and accepted by manufacturer.

l Invoice financing

(52)

In the past, suppliers often reacted to the long payment delays byfactoring their receivables or discounting their bills when they neededcash. Today Original Equipment Manufacturers are recognizing theirsuppliers’ difficulties in accessing finance. And instead of taking a “notolerance” approach, they have started to implement a collaborativeapproach in form of Channel Finance or Supply Chain Finance. Thistechnique is an extended version of Bill Discounting and its underlyingmechanism is Factoring. There are, however, important differences betweenthe three concepts.

See the Table No. 2.1 : Difference between Bill Discounting, Factoring andChannel Financing - printed on the next page please.

(53)Table No. 2.1 - Difference Between Bill Discounting Factoring and Channel Financing

S. No.1.2.3.

4.

5.

6.

7.

Basis of DifferentiationBeneficiary of the facilityType of Finance providedForm of Financeprovided.

Cost of Finance

Stamping of documents

Role of OEMs

Initiative

Bill DiscountingSuppliersPost sale FinanceAdvance madeagainst bills

High rate of discount

Stamping of documentsincreases the cost ofdiscountingOEMs are reluctant toaccept the bill as it becomespayment obligation tohonor the bill on due dateSupplier approaches bankfor the facility

FactoringSuppliersPost sale FinancePurchase ofTrade Debt by factor

High rate of interest

Stamping of documentsincreases the cost ofdiscountingOEMs are not involved inthe factoring as suppliersapproach Factors.

Supplier approaches thefactor for the facility

Channel FinancingChannel partnersPre and Post Sale FinanceDiscounting/Purchasing ofBill / Invoice in case ofpost sale finance and pre-sale finance againstpurchase order / purchaseguarantee.Negotiated rate of interest(lower than bill discountingand factoring rate)Stamping of documents isnot required

OEMs play a main role inrecommending the channelpartners for the facility.

Bank approaches theOEM’s recommendedchannel partners.

(54)

Table No. 2.1 - Difference Between Bill Discounting Factoring and Channel Financing ... (continued)

S. No.8.

9.

10.

11.

12.

13.

Basis of DifferentiationNature of finance.

Grace days

No. of parties

Procedure

Research findings

Extension of payableperiod

Bill DiscountingTransaction based finance

3 grace days allowed

Two party agreement -between financer andsupplier

Cumbersome procedure

Research shows that SMEsare not finding billdiscounting attractive

No scope for OriginalEquipment Manufacturer toextend the p ayable period

FactoringFinance on continuousbasisGrace days equal to thecredit period up to a limitof 60 days

Two party agreement-between factor andsupplier

Cumbersome procedure

Research shows thatfactoring is more suitablefor large industries

No scope for OriginalEquipment Manufacturer toextend the payable period.

Channel FinancingTransaction based finance

No grace period

Three party agreement -OEM, financer and channelpartner

Simple procedure

Very limited research hasbeen carried out in Indiaon this topic

Original EquipmentManufacturer may extendthe payable period

(55)

Ref. : l rbidocs.rbi.org.in

l Dr. Venkatramani, Facility of Factoring services, A GunaGaurav Nyas Publication – Think Line, Nashik, publicationNo. 32, 2004

Channel Financing and Financial Supply Chain -

As the term “supply chain finance or channel financing” is frequentlyconfused with the “financial supply chain,” the researcher found it necessaryto define the latter term as well.

The financial supply chain is not a set of solutions or financial products.Rather, it is the end-to-end sequence of financial processes that take place ina commercial transaction, starting with the issuance of a purchase order andconcluding with the post settlement reconciliation between the buyer’saccounts payable system and the seller’s accounts receivable system. Theconcept of the financial supply chain does not imply any particular level ofautomation, integration, or visibility among participants; nor does it implya specific manner in which a participant manages its working capital. It simplydenotes the financial processes that occur with a business-to-business (B2B)transaction. (10)

2.5 Participants of the Facility of Channel Financing -

The working of Channel Financing illustrate banks playing a centralrole for all the interested parties. It covers the entire supply chain of anorganization right from the stage of supplier supplying raw material to thefinal stage of distribution of finished product to the final consumer.

10. So You Think You Understand Supply Chain Finance? Publication date :July 11, 2007 Author / Source : Susan Feinberg, Research Director, WholesaleBanking, Tower Group (July 2007)

(56)

Thus Channel Financing plays a major role of establishing thelinkages from supplier to manufacturer to dealer /distributor to consumer.

From the above diagram it is clear that Channel Financing is basicallyoutsourcing of a major chunk of working capital finance of Original EquipmentManufacturer.

2.7 Working of Channel Financing -

Channel Financing provides the facility of supplier finance and dealerfinance.

Being a flexible mode of working capital finance, the nature of creditprovided under Channel Financing can be both pre-sale and post-sale finance.

Diagram showing participants of Channel Financing

BANK

DEALER

BANKI. SUPPLIER FINANCE

SUPPLIER <<

II. DEALER FINANCE

ORIGINALEQUIPMENTMANUFACTURER

(57)

In case of pre-sale finance, the finance is provided against purchaseorder or specific purchase guarantee. Under post-sale finance, the financeis provided against invoices. Thus under Channel Financing the finance isprovided as per the requirements of channel partners.

Under supplier finance, the finance is provided by bank to supplieron procurements made by manufacturer or against a purchase order oragainst specific purchase guarantee. The dealer finance provides a receivablemanagement solution to the receivables arising due to lifting of finishedgoods by distributor from manufacturer. In this financing mode, dataregarding supplier and distributor activities is maintained by banks.

Diagram showing facility of Channel Finance

Bank

Supplier

Raw Material

DealerManufacturer

Finished Goods

Paym

ent f

orRa

w Ma

terial

on D

ue da

te

FinanceFinan

ce

Payme

nt for

Finish

edGo

ods o

n Due

date

Cash forFinished

GoodsImmediately

(58)

2.7 Supplier Finance -

Under supplier finance, the working capital finance is provided bythe bank after consulting the concerned Original Equipment Manufactureror the Corporate House. The names of suppliers are recommended by theOriginal Equipment Manufacturers to the bank for the facility of ChannelFinance. The facility is provided to those suppliers who have a direct relationwith the Original Equipment Manufacturer and financing is based on thestrength of their business relationship.

The procedure of supplier finance can be explained as follows -

1. Original Equipment Manufacturer recommends the names of suppliersto bank. But now even banks are taking lead and approachingmanufacturers for getting the names of suppliers to whom financecan be provided.

2. Bank appraises the supplier.

3. Manufacturer issues purchase order or specific guarantee to supplier.

4. A line of credit is opened by bank in the name of supplier.

5. If supplier needs finance for executing this order, he may avail financefrom bank against the order. Otherwise supplier delivers the goodsto manufacturer and issues the invoice which is discounted by supplierwith bank.

6. On the expiry of credit period, the Original Equipment Manufacturerpays the amount due to supplier to bank.

(59)

The effect of above procedure is that the Original EquipmentManufacturer does not approach bank for finance to pay off supplier. Butthe supplier takes finance from bank for raw material sold or to be sold.Supplier gets the finance as per his requirements from bank. The OriginalEquipment Manufacturer enjoys credit and on due date payment is madeby Original Equipment Manufacturer to the bank.

2.8 Dealer Finance -

Under dealer finance, the working capital finance is provided by thebank after consulting the concerned Original Equipment Manufacturer orthe Corporate House. The names of dealers are recommended by the OriginalEquipment Manufacturers to the bank for the facility of Channel Finance.The facility is provided to those dealers who have a direct relation with theOriginal Equipment Manufacturer and financing is based on the strengthof their business relationship.

The procedure of dealer finance can be explained as follows -

1. Manufacturer recommends the names of dealer/distributor to bank.But now even banks are taking lead and approaching manufacturersfor getting the names of distributors to whom finance can be provided.

2. Bank appraises the dealers.

3. A line of credit is opened by bank in the name of dealer.

4. The manufacturer dispatches the goods to distributor.

5. The dealer/distribut or immediately pays for the goods of theManufacturer.

6. On the expiry of credit period, the dealer pays the amount due tomanufacturer to bank.

(60)

The effect of above procedure is that the Original EquipmentManufacturer does not approach bank for finance and does not give creditto dealer/distributor. But the distributor takes finance from bank. TheOriginal Equipment Manufacturer gets the cash immediately for goodssupplied to dealer/distributor and on due date payment is made by dealer/distributor to bank.

2.9 Documentation required in the Process of Channel Financing byBanks -

Generally banks require following documents while approving theproposal of Channel Financing :1. Number of years of standing of dealership or supply agreement2. Past record of business between the dealer/supplier and the

manufacturer.3. Audited/certified financial statements of dealer/supplier for past

three years.4. A letter of recommendation from Original Equipment Manufacturer.5. Board resolution passed by Original Equipment Manufacturer in

their Board meeting.

After elaborating the theoriticial background of Channel Financing,this research seeks to provide on overview and impact of Channel Financingon its participants. The researcher is of the opinion that measuring theimpact of Channel Financing as a tool of working capital finance is ofcrucial importance to determine its success and ability to strengthen thecapacity of industrial units.

Accordingly, for formulating the objectives of the study, an extensivereview of existing literature was undertaken.

* * *

BOOKS -

1. D. K. Agrawal, Logistics and supply chain management, MacmillanIndia Ltd., New Delhi, 2007

2. Handfield and Nichols Jr., Supply chain redesign, Pearson EducationPvt. Ltd., Delhi, 2003

3. Kulkarni and Sharma , Supply chain management – creating linkagesfor faster business turnaround, Tata McGraw-Hill publications, NewDelhi, 2004

4. Eric Hofman and Oliver Belin, Supply Chain Finance Solutions-relevance, propositions, market value, Springer Heidelberg Dordrechtpublication, London New York, 2011

5. Enrico Camerlinelli, Measuring the value of supply chain – linkingthe financial performance and supply chain decisions, GowerPublishing Ltd., England, 2009.

6. Dr. Venkatramani, Facility of Factoring services, A Guna GauravNyas Publication – Think Line, Nashik, publication no. 32, 2004

REFERENCES

(62)

ARTICLES -

1. Shaveta Sharma, Supply Chain Finance – A Value preposition, TheChartered Accountant, Vol 55 no. 11, May 2007, page no 1774

2. William Atkinson, Supply Chain Finance : The Next BigOpportunity, Supply Chain Management Review, PublicationDate : Tuesday, April 1 2008.

3. Susan Feinberg, Research Director, Wholesale Banking, TowerGroup, So You Think You Understand Supply Chain Finance?Publication Date : July 11, 2007.

4. Krishna Mahankali, Channel financing, IBA Bulletin, Vol. xxv no. 5,May 2003.

5. Aberdeen Group, “Get Ahead with Supply Chain Finance : How toLeverage New Solutions for End-to-End Financial Improvement,”July 21, 2006.

6. Bob Kramer, Dancing with banks, Supply Chain Finance insider,Publication date:13 May 2010

7. Paul A. Robinson, HSBC, Financing the Supply Chain, March 2009

8. Kate O’Sullivan, Financing the Chain, CFO magazine, February 1,2007

(63)

WEB SITES -

1. The Role of “Reverse Factoring” in Supplier Financing of Small andMedium Sized Enterprises – www.ruralfinancenetwork.org

2. Supply chain Finance: Are we there yet? – www.fpsc.com

3. Demystifying supply chain finance - www.pwc.com

4. Supply chain finance: Risk mitigation and revenue growth –www.wellsfargo.com

5. Supply chain finance – what’s it worth? – www.imd.org

6. www.indmedica.com

7. www.iwarelogic.com

8. rbidocs.rbi.org.in

* * *