Sainsbury's partners Morgan Stanley for supplier payment system

Sainsbury's partners Morgan Stanley for supplier payment system

UK supermarket chain Sainsbury's has teamed with US bank Morgan Stanley to implement a new payment system designed to make it easier and quicker for smaller suppliers to access account information and receive payments.

Dubbed the Trading Finance Platform, the new system enables suppliers to view their Sainsbury’s trading account via the Internet to access invoices, debit notes, remittance advices and payment dates.

The system will enable suppliers to receive payments within a few days of the supermarket approving their invoices, instead of the existing 45 days.

Morgan Stanley will act as a lender to suppliers, providing early cash settlements for invoices approved by Sainsbury's for a small interest rate payment.

Sainsbury's, which launched the system at an industry conference, says under current interest rate terms, a supplier who invoices the supermarket £100 would receive £99.30 after five days, instead of having to wait 45 days for the entire invoice to be paid.

Mike Coupe, Sainsbury's trading director told reporters the system is a fundamentally new way of managing the financial relationship with suppliers and gives suppliers the information needed to better manage their financial flows.

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