Alternative investments provide complementary strategies for traditional long-only positions in equity, fixed income and cash investments. They span various investment categories like private capital, natural resources, real estate and infrastructure investments.
Alternative investment funds stand out from their counterparts due to a few distinct characteristics, including low liquidity, limited regulation, limited transparency and higher costs; coupled with limited risk and return data. This makes the alternative investments market unique and presents unique opportunities for diversification and potentially higher returns beyond traditional asset classes. It is vitally important for investors to carefully examine these investments to fully comprehend their individual characteristics and risks prior to including them as part of an investment portfolio.
Alternative investments offer many advantages and diversification opportunities compared to more conventional forms such as stocks and bonds, including potentially higher returns and greater diversification opportunities. Alternatives encompass a wide array of assets beyond stocks and bonds.
Invoice Discounting: One of the popular & trusted alternative investments
Invoice discounting allows businesses to sell unpaid invoices for part of their value, and before receiving the cash the lender assesses risk based on several criteria, most importantly the reliability of those who owe money on them.
Once evaluated, a finance provider will offer terms detailing how much money your business will receive as well as their fee for providing discounting services.
Bill discounting companies are increasingly common on the market, providing business owners a platform to sell invoices created by reliable businesses to retail investors and giving these investors access to unpaid invoices that have been issued out. By doing this, businesses gain access to working capital by discounting unpaid invoices issued out to creditworthy businesses.
Top 5 Invoice Discounting Platforms in India:
1. Falcon Invoice Discounting (FID):
Falcon is a peer-to-peer invoice discounting platform, connecting blue chip companies and investors directly. Its primary goal is to revolutionize the investment industry by creating an easy portal for all investors and borrowers of various profiles to access at no risk to themselves or each other. In contrast to banks or other financial institutions, it increases investors’ yields by eliminating intermediary institutions like depository institutions or commercial banks as mediators between parties involved in transaction.
Investors can earn 16 to 22% annually with just 30 to 150 days invested, at no financial risk and with monthly returns without hidden charges or surprises.
The reasons behind choosing Falcon Invoice Discounting over traditional factoring services:
- Investors can fund up to 90% of invoice value; and it is fully automated with an e-invoicing option and no hidden charges or collateral required for financing.
- Secured against debtors who owe the invoice, advances of cash may vary depending on individual debtors and payment history.
2. Finworks360:
Finworks360 is a market place where sellers and investors can meet. At Finworks360, great care is taken in identifying sellers by conducting extensive due diligence on them, especially their track records, customer relationships and any transactions in which the seller intends to raise funds for.
Finworks360.com provides a platform that engages entities post credit appraisal and checks. Unlike any other receivables market place in India, which only facilitates sellers and investors connecting, Finworks360 does more.
Finworks360 understands both the Indian market and receivables business in particular. Finworks360’s management was one of the pioneers of Factoring/Receivables Financing business in India; having funded close to Rs 8,500 Cr receivables without delinquency speaks volumes for their expertise.
3. Clear:
Clear Invoice Discounting is an intuitive and powerful platform designed to assist businesses in managing their cash flow more effectively. Leveraging AI and Machine Learning technology, businesses can easily apply for discounts when invoicing suppliers and apply them when billing for purchases resulting in faster payments and improved inventory control.
When it comes to early payments from suppliers, buyers now have an easier and less costly option for getting early payments from TReDs marketplaces with Clear Invoice Discounting platforms than using surplus cash or bank credit lines as early payment mechanisms. Upload invoices directly onto any TReDs marketplace powered by Clear Invoice Discounting so as to have complete control of payment decisions while increasing liquidity at lower costs.
Features: Wage no costs while making 2-5 times more money with digital vendor management and increased involvement from vendors by threefold. Take the benefit of flexible financing alternatives for getting early bill payment. Utilizing the shortest ERP integration possible, go online quickly using platform-based funding from Treasury, TReDS, Banks or NBFCs.
4. UpScale:
UpScale by CredAble is an advanced AI and tech platform designed to connect you with trustworthy lenders at competitive interest rates.
With one straightforward application process that doesn’t involve paperwork, you can apply for over 30 lenders at once! Plus!
Benefits of working with them include fast approval and disbursement times (within two business days!).
Some of the features of UpScale include:
- Competitive interest rates
- Advanced AI and tech platform
- Wide lender network
- Fast approval and disbursement
- No paperwork required
5. FlexiLoans:
FlexiLoans serves as both lender and facilitator. Through their Flexi Vendor Financing lending product, SMEs can easily obtain discounted bills at discounted rates through this platform – with an approval process taking less than 72 hours!
To reduce its risks, the company requires applicants have been in business at least one year with annual revenue exceeding INR 20 lakh and profits exceeding INR 5 lakh. Furthermore, companies must register as suppliers to blue-chip corporations.
As the vendor receives interest at a rate that surpasses all others, shares from the borrowing firm become available and purchases become more enticing, thus decreasing price sensitivity. Acquisition for borrowing companies is made smooth as they don’t rely on external lenders to complete their purchase. Leasing options enable borrowers to defer full repayment for cash-strapped businesses.
Conclusion:
Invoice discounting is an efficient way for businesses to access working capital, increase liquidity, and reduce cash flow wait times without needing long-term loans from creditors. Falcon Invoice Discounting allows borrowers to lend money for fixed returns of up to 22% per month over periods ranging from one month to four months, providing the lender with predictable returns from lending money out at competitive interest rates.
Guest article written by: 
Anji Velagana, a graduate in Electronics and Communication Engineering from Jawaharlal Technological University, Kakinada. He has 5 years of experience in content writing. He is currently working as a Digital Marketing Analyst and Content Contributor for Falcon Invoice Discounting.