Solution offers respite for European carriers struggling with 90-day payment terms.
The freight payment solutions provider U.S. Bank said this week they have begun offering trade finance services in Europe.
The services mirrors what U.S. Bank offers to trucking companies in North America, essentially providing carriers a way to get paid earlier than they ordinarily would while allowing shippers to pay to the terms of their contract.
The financing issue is even more acute for truckers in Europe than it is in North America, U.S. Bank executives told American Shipper this week at the Council of Supply Chain Management Professionals’ annual conference in San Antonio.
That’s because payment terms often stretch to 90 days in Europe, whereas they are typically around 30 days in North America. Indeed, trucking capacity pressure in Europe is more attributable to companies’ difficulty in financing their operations than a shortage of drivers, as is the case in North America.
Rick Erickson, global director of freight payment solutions for U.S. Bank, said the move to offer trade finance in Europe was driven by shipper customer demand for a solution that matched what they were able to offer carriers in North America.
Harold Bosse, Europe/Middle East/Africa product director for U.S. Bank, said the product represents an innovation in Europe, where carriers have usually relied on factoring (where they, in essence, sell their invoices at a discount to a third party). Factoring is looked down upon in North America, but is an accepted way of doing business in Europe, he said.
The trade finance offering, released through U.S. Bank’s European brand Elavon, includes VAT support, and is available in English, German or French platforms.
U.S. Bank extends trade finance product into Europe
