As the Federal Reserve continues its research on developing an entire new infrastructure for a faster payments system in the U.S., the White House took a first step on July 11 setting up a volunteer program asking corporations to commit to paying their suppliers faster.
So far, corporate giants such as Apple, AT&T, Coca Cola and Johnson & Johnson have pledged to pay their smaller suppliers within 15 days in support of President Barack Obama's SupplierPay program.
San Francisco-based Taulia Inc., a supplier financing provier, says it is quickly responding to the SupplierPay launch by releasing an Early Payment Quick Start initiative to offer incentives to corporations that pay suppliers earlier.
Some companies already committed to SupplierPay have already chosen Taulia as an early payment financing provider, Taulia states in a July 11 press release. Taulia did not reveal the names of those companies.
So many American small businesses are closing their doors simply because of poor cash flow, Bertram Meyer, Taulia's CEO, says in the release. Since 2008, small businesses have faced an increasingly difficult borrowing environment when they could have received early payments on their approved invoices at much more favorable rates."
The volunteer SupplierPay program is based on a similar program for government contractors in which the government promises to pay contractors quickly if those companies commit to do the same with their smaller suppliers, the White House stated.