let's get our questions answered at tomorrows webinar, page-128

With trade finance there are generally the two parties involved

Lets say ABC manufacturers beds
Let's say DEF buy beds from manufacturer for retail shop

Let's say the amount of invoice is $10,000

manufacturer agrees to $9400 upfront rather than $10,000 in 90 days

Invigo has technically made $600 over next 90 days or 6.3% or 2% month as they only need to extend $9400, not $10,000

on the flip side, for upfronting the invoice to ABC, it then charges DEF company a fee or interest on the $10,000, let's say 2% month with 33% of the invoice plus 3 months interest payable upfront by DEF

So DEF pay $3300 + $600 (interest) upfront to Invigo to cover the $10,000 invoice

this means that Invigo now only require $9400 less $3300 received less $600 received
= $5500 required upfront from pocket

Invigo take a charge over DEFs and sometimes ABCs invoices as a group (receivables) as security

Now Invigo get their funds from lenders at say 6%pa

Invigo only need $5500 as the rest is coming from DEF upfront

5500 x 3 months at ,5% mth = $82.50

Invigo has made $1000 ($400 reduction in invoice from ABC and $600 from DEF) less $82.50 say $917.50 after their own cost of funds

Then DEF pays the remaining invoice over 2 further payments at start of month 2 (which is only 1 month later as they pay in advance) so month 2 when DEF make $3300 payment, Invigo is now only out of pocket $5500 less $3300 = $2200 so they can pay back the lender and the interest is reduced further

The lender has charge over Invigo loan book, Invigo has charge over manufacturer and or wholesaler receivable book

in this instance Invigo makes $917.50 on outlay of $5500 for 30 days and then reduces to $2200 for 30 days

return roughly 5-6% month or 60-70%pa on borrowings at just .50% month or 6%pa

Also you have funds coming back into the account each week or month so it's like one big line of credit revolving in and out allows you to technically fund 5-10 times the amount of funds you actually have on hand once it starts working, a bit like Afterpay

Yes if it gets too big further lender funds may be needed, but as you can see you never really fund 100% due to invoice reduction from ABC and interest made from DEF along with 1st installment paid upfront

I'm half asleep but hope this makes some sense