Online receivables auction platforms are growing in number
and prevalence, spurred by commercial and regulatory developments
in the commodities and banking industries. This briefing looks at
some of the high-level issues that industry players should consider
when negotiating an agreement to sell trade receivables on these
digital platforms.
Over the past year, there has been an increase in off-balance
sheet transactions pursued by participants in the commodities
industry, including receivables discounting facilities,
securitizations and repos. This increase has been driven by a
variety of factors, including the need for additional working
capital as a result of increased commodity prices, a reduction in
committed capital provided by certain banks and regulatory costs
imposed on traditional forms of lending. A similar trend has
occurred across a wide range of other industries. As a result,
several online receivables platforms ("Receivables
Platforms") have emerged to
