The Time Value of Money and Delayed Payments
“A dollar today is worth more than a dollar tomorrow.” Known as the time value of money, this principle guides smart financial choices. But when customers take 60–90 days—or even longer—to pay, the reality can impact your working capital and growth plans.
Most businesses do nothing about it. Smart ones act.
Why Delayed Payments Must Be Managed Strategically
Cash flow management strategies are critical for SMEs. Waiting on invoices can strain operations, slow growth, and lead to reactive borrowing. Traditional fixes—like issuing loans or overdrafts—don’t provide a customer‑friendly solution.
Rethinking Together: Flexible Payment Terms for Customers
Instead of early-payment discounts, consider a late payment premium as part of your pricing strategy.
How it works:
- Your customer requests 60–90 days to pay.
- You agree—but add a small, transparent fee to account for the delay.
- It’s not a penalty—it’s shared flexibility: they pay later; you stay liquidation‑ready.
This is where traditional invoice financing often falls short—but Fundtap fills the gap.
Fundtap: Invoice Financing for SMEs That Works Both Ways
Fundtap delivers advance payment for small businesses, tailored for modern workflows:
- You complete the delivery.
- Fundtap pays you—fast.
- Your customer pays later on their preferred terms.
- You may pass the FundTap fee (commonly 4–6%) along as a late payment premium—if agreed.
This means:
- Your cash flow stays healthy
- Customers retain payment flexibility
- Your offering becomes more attractive in sales conversations
You’re not just managing cash flow—you’re building trust and offering convenience.
Quick Comparison: Banks vs. Fundtap
| Feature |
Bank Overdraft / Loan |
Fundtap (Invoice Advance) |
| Customer‑friendly flexibility |
Typically no |
Yes—customised to customer needs |
| Prevents payment delays stress |
Not directly |
Yes, you get paid upfront |
| Builds a selling advantage |
No—finance is behind the scenes |
Yes—make payment terms a differentiation |
| Adds financial clarity |
Often opaque fees & interest |
Transparent and optional fee structure |
How This Enhances Cash Flow Management Strategies
By leveraging invoice financing for SMEs with a late payment premium, you:
- Reduce invoice processing time and overdue risk
- Maintain working capital without borrowing
- Make payment terms a strategic sales lever
- Operate with confidence and clarity
What You Can Do Next
- Assess whether passing along a late payment fee fits with your customer relationships.
- Speak with Fundtap to explore how invoice financing can support your cash flow and sales.
- Use delayed payments as a strategic element—not a handicap—in negotiations.
Final Thoughts: From Waiting to Winning
Delays in payment don’t have to be a loss. By reframing late payments via fee-based flexibility, you create clarity, control, and a competitive edge. That’s not just better cash flow—it’s smarter business.
Let Fundtap help you turn your unpaid invoices into forward momentum.
