Supply chain finance

… for suppliers delivering/invoicing to Siemens Energy in Canada

Program fee
The only cost of the program is the discount charge that a supplier pays on the face value of the receivable to receive early payment.
The current annualized discount rates are based on the supplier’s annual volume with Siemens Energy:

> 500k CAD: 1.75% p.a.* + CDOR**

> 300k CAD, < 500k CAD: 2.00% p.a.* + CDOR**

< 300k CAD: 2.75% p.a.* + CDOR** 

* The fixed fee is covering the costs of the program as well as those of the banks providing the fund for the benefit of the suppliers.
** The underlying interest reference rate depends on the currency of the invoice and is fixed in the corresponding contract with ORBIAN, e.g. for CAD invoices the relevant rate is the CDOR – the negotiated payment term (e.g. 90 days) is relevant for the calculated CDOR (e.g. 3M CDOR)

Sample calculation:
A supplier delivers products worth 1 million CAD. The payment is due in 90 days (net). When participating in the SCF program, the supplier will receive the payment 80 days earlier.

Discount rate: 7.25% p.a. (1.75% p.a. + CDOR (e.g. 5.50% p.a.))

Discount charge: CAD 16.111 (1m CAD x 7.25% x (80/360))

Discounted value receivable: CAD 983,889 (cash received by supplier)

Cash flow benefit: CAD 218,642 (payment after 10 instead of 90 days)

[Discount charge as a percentage of the receivable: 1.61%.]

... for Chinese suppliers delivering/invoicing to Siemens Energy in China

Program fee

The only cost of the program is the discount charge that a supplier pays on the face value of the receivable to receive early payment. The current annualized discount rate is benchmarked to LPR (Loan Prime Rate), but adjusted based on market liquidity, bank's cost of funding and Siemens credit rating.

Current discounting rate as below:
Financing days < 210 days
Auto financing: 3.6% p.a.
Manual financing: 4.1% p.a.

Financing days >= 210 days
Auto financing: 3.8% p.a.
Manual financing: 4.3% p.a.

Sample calculation:

A supplier delivers products worth 100k RMB. The payment is due in 90 days (net). When participating in the Chinese SCF program, the supplier will receive the payment 80 days earlier.

Discount rate: 3.6% (annualized-auto financing mode)
Discount charge: RMB 800 (100k RMB x 3.6% x (80/360))
Discounted value receivable: RMB 99,200 (cash received by supplier)
Cash flow benefit: RMB 22,044.44 (payment after 10 instead of 90 days)
[Discount charge as a percentage of the receivable is about: 1%]

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China / CITI Supply Chain Finance @ Siemens Energy

… for suppliers delivering/invoicing to Siemens Energy in Australia

Program fee

> 15m AUD: 2.50% p.a.* + BBSW**

> 150k AUD, < 15m AUD: 2.70% p.a.* + BBSW**

< 150k AUD: 3.50% p.a.* + BBSW**

* The fixed fee is covering the costs of the program as well as those of the banks providing the fund for the benefit of the suppliers.
** The underlying interest reference rate depends on the currency of the invoice and is fixed in the corresponding contract with ORBIAN, e.g. for AUD invoices the relevant rate is the BBSW – the negotiated payment term (e.g. 90 days) is relevant for the calculated BBSW (e.g. 3M BBSW)

Sample calculation:
A supplier delivers products worth 1m AUD. The payment is due in 90 days (net). When participating in the SCF program, the supplier will receive the payment 80 days earlier.

Discount rate: 6.60% p.a. (2.50% p.a. + BBSW (e.g. 4.10% p.a.))

Discount charge: AUD 14,667 (1m AUD x 6.60% x (80/360))

Discounted value receivable: AUD 985,333 (cash received by supplier)

Cash flow benefit: AUD 218,963 (payment after 10 instead of 90 days)

[Discount charge as a percentage of the receivable: 1.47%.]

... there are several local SCF programs available, which works similarly than the described ones or even in different ways.

Your contact persons in the countries will connect you with the advisors in regards to the local SCF programs.

Please feel free to contact as well the SCF team in Germany for further assistance/information:
Helpline: + 89 780 51222
mailto: supply-chain-finance.sfs@siemens.com