F.A.Q

Frequently Asked Questions & Answers

Have a look at frequently asked questions & answers to understand more.
Ennovative Capital (ECap) is a Financial Technology (Fintech) company that leverages technology to solve working challenges for businesses in Africa. The flagship product of ECap is the supply chain finance solution through our innovative cloud-based platform that brings together buyers, their suppliers, and funders.
Our platform is multi-funder solution which ensures that ECap has no restrictions on the quantum of funding that it can attract to finance working capital opportunities within the supply chains.
Our platform encompasses four core suites with a wide range of functionalities, including a Working Capital Analysis suite, which analyzes a company’s spend and the potential cash flow that can be generated from within the supply chain, as well as a Supplier Onboarding Tool, which educates and onboards suppliers to a buyer’s supply chain finance program. In terms of financing, our Trading Suite allows a buying organization/importer to extend payment terms while offering early payments to suppliers. Our Receivables Financing suite allows companies to reduce their collection time by getting paid earlier.
We are continually innovating and will be rolling our more working capital solutions to our clients.
Supply chain finance, also known as supplier finance, reverse factoring, or accounts payable finance is a solution that helps meet corporate objectives, including working capital and earnings before interest, taxes, depreciation, and amortization (EBITDA) improvement, as well as reduces the risks of supply chain disruption. It allows companies to optimize their payment terms while providing the option to their suppliers to get paid early. The low financing fee for early payment paid by the suppliers is based on the credit worthiness of the buying organizations.
Supply chain finance allows a buying organization to optimize its payment terms to its suppliers and improve working capital. At the same time, it gives the option to suppliers to receive early payment based on attractive financing rates.

Process overview

  • The supplier sends their invoice to the buyer in the usual manner.
  • The buyer approves the invoice from the supplier and uploads the information on Ennovative Capital’s supply chain finance platform.
  • The supplier is notified and has full visibility of the approved invoices on the platform.
  • The supplier has the option to trade his invoices immediately and get early payment by a funder or, alternatively, can choose to wait until the invoice is due.
  • Funder(s) receives and processes early payment requests and provides funding to supplier
  • At the maturity date of the invoice, the buyer pays the funder(s) if the supplier has sold invoices or the supplier if the supplier has not sold invoices.
The funds will be electronically transferred to the supplier’s bank account in as quickly as 24 hours.
No. The The Ennovative Capital platform operates in the cloud, is available 24/7 online, and does not require software installation.
Ennovative Capital has made security a primary operational focus. We therefore took time to shop for an international platform that met the highest standards of security and integrity given the sensitivity of information we hold. Our solution is powered by PrimeRevenue on a white-label license basis acquired through Propell Supply Chain Finance of South Africa. OpenSCi product suite is based on many layers of security, each with its own policies, controls, and monitoring. The developers apply the strongest security and encryption protocols on all data, activity, and transmissions across the platform. The platform has been approved and is being used by over 70 leading global financial institutions, including the largest commercial banks.
The main benefit of supply chain finance is that the buyer does not pay any fee to extend its payment terms and the supplier only pays a small discount if he wants to get paid early.
By using Ennovative Capital’s supply chain finance platform, buyers are able to achieve continuous benefits, including the following:
• Gain significant and ongoing working capital improvement
• Generate free operating cash flows
• Standardize and harmonize payment terms
• Improve accounts payable efficiency and reduce administrative costs
• Reduce supplier payment inquiries through supplier reporting platform
• Reduce risk of supply chain disruptions
• Use excess cash profitably through self-funding option for your supply chain finance program
The benefits of funding supply chain finance programs include the following:
• Having a direct relationship with the supplier/seller and buyer/obligor.
• Money flows do not go through Ennovative Capital.
• Supply chain finance platform is tested and approved by over 70 funding sources, including some of the largest global banks and industry standard audits, while running on highly secured systems.
• Offering a fast go-to-market strategy for banks.
• Allowing banks to market supply chain finance independently based on Ennovative Capital’s platform.
• Full assistance and support to manage financing programs is given.
After an individual supplier education phase, our web-based enablement tool, collects the necessary Know Your Customer (KYC) information from the supplier for the respective funder. A 24/7 Ennovative Capital support team based in Kenya is dedicated to answering all questions and providing ongoing support to all suppliers. The KYC information is required by the funder because of financial regulations and is a company identification process, including the collection, verification, and maintenance of records, such as information to prevent money laundering and fraud. Different financial institutions have different KYC requirements.
A letter of credit is a letter from a bank guaranteeing that a buyer’s payment to a seller will be received on time and for the correct amount. Ennovative Capital’s working capital finance solutions do not require letters of credit.
Working capital is one of the most important indicators of efficiency in supply chains. It is defined as net liquid assets (current assets minus current liabilities) available to an organization to meet liquidity needs in day-to-day operations.
Skillful cash management, including working capital management, cash forecasting, and financing is key to the success of an enterprise. With multiple factors governing a company’s working capital performance, there are some aspects that are beyond control, such as input costs. Then there are others that can be managed, controlled, and improved through strategic measures. These parameters include managing the firm’s inventory efficiently, collecting cash flow from the customers early, and extending the payment terms for suppliers.
Currently, the most common measure adopted by corporations worldwide in managing working capital performance is extending supplier payment terms since it is an easy short-term action. However, it runs contrary to actions within supplier organizations, where the focus is on sustainable receivables improvement. With many suppliers undergoing financial duress, extended payment terms cause an increasing concern over the stability of their supply chain.
Furthermore, this approach often results in a domino effect as suppliers respond by adopting similar measures with their own supplier base. Hence, a huge amount of working capital is being locked up across the supply chain. Companies often underestimate their ability to extend payment terms with their suppliers. They lack awareness of financing opportunities adding value to the firm while strengthening relationships with suppliers. Working capital finance is increasingly being seen as the solution to this dilemma.
Days Sales Outstanding. A high DSO number shows that a firm is selling its products or services on credit and is taking more time to collect the payments from its customers.
Formula: Days Sales Outstanding: (A /R / Sales) * 365
To obtain more information as either a client or a partner, please contact us today. A Ennovative Capital representative will answer all your questions.
Ennovative Capital’s supply chain finance platform is designed to integrate with e-invoicing systems. Electronic invoicing is not a negative for supply chain finance. However, when combining the supplier finance and e-invoicing processes, Ennovative Capital is able to speed up the sales cycle for e-invoicing solutions as well as increase the penetration of your solutions with your existing supplier base. In addition, it generally allows reducing the time when invoices are being approved by the buyer.
No, Ennovative Capital is an independent Fintech, operated by finance, trade, and technology professionals with decades of experience.
The registration process for a supplier is designed to be quick and easy. On average, companies need 48 hours to register to a supply chain finance program and start selling their invoices for early payment.
No change is required. The existing process that a supplier performs to invoice the buyer still remains in place.
No change is required. The existing process that a supplier performs to invoice the buyer still remains in place.
Yes. The supplier is not required to trade or request early payment of its invoices.
The only cost of the program is the “discount charge” that a supplier pays to receive early payment. There are no fees to join, maintain, or exit the supplier finance program.
Generally, the overall fee is significantly lower than similar financing solutions, such as factoring or asset-based lending.
The supply chain finance pricing or discount is based on three variables:
1. Base rate, such as the CBR (Central Bank Rate) or LIBOR (the London Interbank Offered Rate)
2. Financing spread, as determined by the funder and based on the credit worthiness of the buyer
3. Servicing fee, as determined by Ennovative Capital for the setup (e.g., legal agreements, ERP connection) and ongoing management of the supply chain finance program (e.g., platform, supplier onboarding, reporting)
Ennovative Capital’s platform provides suppliers with the following benefits:
• Early payment of outstanding receivables
• Compelling alternative to expensive factoring or bank loans
• No debt, resulting in better balance sheet metrics
• Full transparency and visibility of all approved invoices
• Reduced disputes and collection costs
• Payment visibility and certainty regarding their approved receivables from specific buyers
• Non-recourse financing
On average, it takes around three months to implement a program.
The platform managed by Ennovative Capital has no limitation in terms of country or currency coverage. Whereas our area of operation is Eastern Africa we can work with our customers to set up working capital finance programs to in any jurisdiction and currency in Africa. The supplier could reside in any jurisdiction globally.
Yes, as a progressive Fintech, we are continually “thinking global and acting locally”. We currently have capabilities for the following:-
• Receivables Finance to enable suppliers to creditworthy buyers access early liquidity
• Distributor Finance to enable large manufacturers facilitate working capital support for their distributors
We are at an advanced stage to introduce the following solutions
• Purchase Order Financing to enable suppliers access pre-shipment finance to service orders to creditworthy buyers
• Asset-based Lending to enable anyone with stocks access funding through a structured collateral management process.
Working capital finance is a solution that helps companies maximize the efficiency of their capital used in their day-to-day trading operations, allowing them to extend payment terms on the buyer side and/or reduce collection times on the supplier side through third-party financing or self-funding sources.
A simple way to improve working capital relates to the timing of invoice payments and collections by companies. It is straightforward: buying organizations are focusing on increasing their payment terms or Days Payable Outstanding (DPO) to their suppliers while suppliers are looking to collect payments earlier and reduce Days Sales Outstanding (DSO).
Days Payable Outstanding. It represents a company’s average payable period indication and how long it takes a company to pay its invoices from trade creditors, such as suppliers.
Formula: Days Payable Outstanding: (A / P / COGS) * 365

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