In a nutshell, it is the
unconditional promise to pay from an investment grade obligor on a date-certain,
sum-certain contract- payment obligations. Regardless of the industry or sector
where your business operates, the key to accessing this resourceful financing
mechanism is to be in business with entities that hold investment grade credit
ratings (obligor) – BBB rating and above.
Instead of going through the regular hassles of traditional financing,
monetization financing will allow you to monetize today all the future cash flow
stream your company is poised to receive from investment grade clients you do
business with.
The entire emphasis of this funding mechanism is the risk taken by the lender on
the investment grade entity your company is doing business with, not on the
eligibility of your company as a borrower. This allows you to leverage on the
financial and credit wherewithal of your client which translates into working
capital on a non-recourse basis, 100% financing, competitive interest rates and
flexible terms, without ceding equity positions to investors, and in absence of
pesky loan covenants.
Implemented by one of the country’s leading financial institutions in this realm
with transactions in excess of U$ 280BB over the last 15 years, monetization
financing is a dynamic tool to access capital expeditiously. From beginning to
end, funding can take place as early as 4 weeks. Minimum loan amount is $5MM.
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