Win-win and No-win Situations in Supply Chain Finance: The Case of Accounts Receivable Programs

The paper aims to investigate whether supply chain finance (SCF) solutions have the potential to create tripartite value in the international trade arena. Distinguishing three actors, this value proposition is examined by modeling an accounts receivable platform (ARP) program. The setting is adapted to a supply chain with an OECD supplier and non-OECD buyers. The paper identifies trends in parameter values that bring about various situations, in which all parties benefit sufficiently in any total win situation. However, they are most likely limited to trade flows of higher valued goods that are frequently traded. For the supplier acting as the focal company and the financial institutions, these programs are only feasible if a large number of participants (buying customers) can be convinced to take part in the financing alternative. The resulting benefits are unlikely to be shared on even terms between the actors. If successfully implemented, the focal company will benefit most from the supply chain finance solution.