Dynamic Discounting: smarter early payments, stronger liquidity

With an early payment discount, the discount is automatically calculated based on the number of days an invoice is paid before its due date. Through Dynamic Discounting, the supplier can accept or decline the discount proposal per invoice. Both parties retain full control, while the buyer benefits from the discount and the supplier gains access to liquidity sooner.

With traditional payment terms, fixed agreements are made, such as “2% discount for payment within 10 days.” Dynamic Discounting is more flexible: the discount changes depending on the exact moment of payment. This allows organizations to optimize per invoice and respond to their current cash position, instead of being locked into rigid terms.

Dynamic Discounting improves cash flow within procurement by smartly deploying surplus liquidity. By paying earlier for a discount, you realize an attractive return on available cash while simultaneously lowering costs. This leads to a more efficient use of working capital and a healthier financial position.

Within supply chain finance, Dynamic Discounting acts as a buyer-driven financing solution. Instead of external financing, the buyer uses its own funds to pay suppliers sooner. This strengthens the supply chain, reduces financial risk for suppliers, and contributes to a more stable collaboration.

Dynamic Discounting is suitable for organizations with a professional procurement and finance department and sufficient liquidity. Companies with many suppliers and a high invoice volume in particular benefit from this solution. Both mid-sized and large organizations can use Dynamic Discounting to save costs and improve supplier relationships.

Yes, Dynamic Discounting can be integrated with ERP systems and financial software. Automatic integrations process invoices, payment terms, and discounts in real time. This means Dynamic Discounting connects seamlessly to existing processes, without additional manual actions.