What is TrustBills?
TrustBills is an auction platform that allows to sell trade receivables on a true sale by starting a bidding competition, an auction, among institutional investors, banks and corporate clients. Access to TrustBills is provided to interested companies and investors via Partner Banks. Invoices can be uploaded manually or automatically. The sale of receivables can be executed with or without the notification of the debtor (undisclosed or disclosed assignment). TrustBills also allows to send a request for an irrevocable payment undertaking to the debtor.
Who are the shareholders of TrustBills?
The current shareholders are Maravon GmbH - a financial advisory firm, specialized in financial technology -, DZ BANK AG and Deutsche Bank AG.
Why do I need TrustBills
Like the successful Ebay, TrustBills uses the principle of an internet-based auction platform. TrustBills has established a fast, fair and easy-to-use global marketplace for trade receivables accessible for companies and investors. Companies that sell their trade receivables through TrustBills experience a transparent, fast and easy pricing process that gives investors an overview of all offered trade receivables and enables sellers to get access to a broad range of investors. The key features of TrustBills are:
What are the economic benefits of TrustBills?
TrustBills provides an alternative to the established financing products, to generate liquidity as well as to reduce collection expenses and credit/payment risks. The true sale can be used to shorten the balance sheet, which usually results in an improvement in the capital and/or balance sheet ratios. This usually leads to a reduction in financing costs.
How much does TrustBills cost?
For the initial registration at TrustBills, we charge a fee of EUR 500.--. For the upload and start of an auction for a trade receivable the seller pays a Posting Fee of 0.10% of the invoice amount (min. EUR 100.--) for unconfirmed receivables. Each seller who receives a confirmation for his trade receivable pays a Confirmation Fee of 0.02% in addition to the Posting Fee (in total min. EUR 120.--).
For the repeated auction of receivables that could not be sold, we charge a Re-Posting Fee of 25% of the original Posting Fee. For each repeated verification of an invoice that have not been accepted in the first place, we charge a Re-Check Fee of 50% of the Posting Fee. The buyer of a trade receivable pays a Closing Fee dependent on the residual maturity of the trade receivable after the start of the auction i.e. from 11 to 30 days 0.05%, from 31 to 60 days 0.10% and from 61 days and longer 0.15%
|Registration Fee||once||EUR 500.--||Every user|
Fees calculated on the notional invoice/trade receivable amount.
|Unconfirmed trade receivable||Confirmed trade receivable||Payable by|
|Posting Fee||0.10% min. EUR 100.--||Seller|
|Confirmation Fee||plus 0.02%, incl. Posting Fee min. EUR 120.--||Seller|
|Re-posting of a non-sold invoice/trade receivable||0.025%||0.030%||Seller|
|Re-check of a declined invoice/trade receivable||0.050%||0.060%||Seller|
|Remaining days (from day of auction until maturity of the invoice/trade receivable)||Payable by|
|11 - 30 days||31 - 60 days||61 days and longer|
How do I register and how long does it take?
The registration process has been designed to ensure maximum security. The duration of the registration depends on the user's collaboration. All user data undergoes a multi-level audit process in cooperation with the selected Partner Bank. The entire registration process can take between 10 days and 3 weeks. To ensure a smooth and fast registration, please contact your Relationship Manager at your Partner Bank. She/he can assist you with the registration process and ensure that the processes with the Partner Bank are carried out without delay.
Do I have to open a special account and how much do I have to pay for this?
To use TrustBills an account at a Partner Bank is required. The costs are determined by each Partner Bank.
Do I have to inform the debtor of my trade receivable about the sale? How and when does the debtor know that my trade receivable has been sold?
You can choose whether the debtor should be informed about the sale of the trade receivable(s) or not. TrustBills allows the sale of trade receivables based on a disclosed or an undisclosed assignment. The prerequisite for selling a trade receivable is an account authorization for TrustBills for all accounts on which invoice payments shall be executed. However, in certain jurisdictions it might be mandatory to inform the debtor about the sale of the receivable(s). In case the seller chooses to notify the debtor, TrustBills allows the seller to determine whether the debtor shall execute payment to the account of the seller or to the account of the buyer of the trade receivable(s). TrustBills also enables the seller to request an irrevocable payment undertaking by the debtor.
Who can sell their receivables via TrustBills?
Entities registered in the commercial, cooperative or association register who are (target) customers of Partner Banks and who can demonstrate a business activity of at least 3 years can sell B2B (exclusive) trade receivables on TrustBills.
What kind of receivables can be sold via TrustBills?
All trade receivables towards entities registered in the commercial, cooperative or association register with a minimum amount of EUR 15,000 and a minimum residual term of 11 days from the start of the auction.
Can invoices for progress/upfront payments be sold via TrustBills?
Only claims that actually exist and are not subject to any objection may be offered on TrustBills - ie claims that must be settled by the debtor at maturity. Whether or not your claim to progress/upfront payments meets these requirements depends on the underlying contract between your company and your customer/debtor. Typically, in the case of progress/upfront payments, they are intended to flow to the provider of goods or services at short notice so that he can use them to cover the costs associated with further project implementation. Therefore, in many cases, claims for payments will be free from any objection. However, special caution is required in the case of the last claim/installment for a project, because it is obvious that the debtor can claim for reduction if the project was not completed in accordance with the contract.
Who is bidding on the trade receivable to my invoice?
TrustBills ensures a strong widening of the investor base. In addition to banks, TrustBills also offers institutional investors the most cost-effective way to gain access to a profitable market with a very attractive risk profile and short capital commitment. With TrustBills, investors can use an automated filter function to set up a portfolio based on pre-defined criteria. For such portfolios TrustBills offers integrated processes for an automated exposure- and risk-management as well as for reporting and accounting tasks.
Is my data protected from my competitors? Can I exclude certain buyers?
Users cannot access other user data. Direct access to the database is also protected by security mechanisms to prevent attacks by hackers. Where possible, additional content is stored encrypted to increase security once more. As a public marketplace for receivables it is important to address the largest possible number of investors. To insure the auction-character it is necessary to initiate a bidding-process. Sellers of trade receivables have to choose several investors and can specify to which industries or companies they want to offer their trade receivables. This is possible due to a so-called “Investor Management”, which can be used to choose entire industries as well as individual companies.
May I act as a seller and a buyer of receivables at the same time?
Yes, TrustBills does not distinguish between the role as a buyer and a seller. Once all required data is received by TrustBills, you can act freely on our platform.
How safe is the platform?
TrustBills is subject to the provisions of the German data protection laws. The servers are located in Germany. Fraud prevention on TrustBills is an important element.
All participants are authenticated by a KYC process provided by a Partner Bank. Therefore fraud can be prosecuted and the responsible persons can be held liable. Using methods of artificial intelligence and automatic learning trade receivables that are uploaded for an auction are prophylactically checked and analysed to stop fraud before it is committed.
What is the key data for an auction?
After checking and approving the trade receivables by TrustBills, the sellers can i.a. determine the minimum sales price, the starting date and the duration of the auction as well as the possible investors that may bid on the trade receivable(s).
Which filter functions are available?
TrustBills works with a so-called “Investor Management”. The user has the possibility to configure this filter and activate branches and individual investors for auctions. Investors, for their part, can make their bids manually or automatically based on a variety of criteria (such as amount, tenor, ROI, debtor, etc.).
How do investors place their bids on trade receivables?
Investors can place their bids manually or automatically based on various criteria (e.g., amount, term, ROI, debtor, etc.). The next possible bid must be at least the amount of the minimal increment (EUR 10.--) higher than the actual best bid.
Who pays my money, when and to what amount?
After the successful completion of an auction, the seller receives the full purchase price from the buyer of the trade receivable(s). TrustBills acts as an intermediary, who ensures the related process. Upon payment of the trade receivable TrustBills initiates the automatic transfer of the payed amount to the buyer, that means the new bearer.
What happens if the debtor does not pay the invoice?
If the debtor does not pay at the due date, TrustBills will start an automatic multistage process to remind the debtor.
Which aspects are relevant for cross-border trade receivables?
One of the essential aspects of the international purchase of receivables is the consideration and assessment of different legal systems. Thus, the purchase of a trade receivable of a German supplier held against his French customer is subject to a different legal framework compared to the case of a French supplier selling a trade receivable held against a German customer. TrustBills creates and integrates a rule matrix for international transactions. This matrix considers i.a. civil-law assignment processes, investor- & data protection, tax questions as well as laundering and embargo regulations - all together in an international context.
Do I have to follow the auction or can I set up notifications individually?
The auction is carried out automatically. You will be informed at the end of the auction about the result by e-mail.
How big is my workload?
As a seller of trade receivables, your effort is minimal. You have three options for uploading:
After approval of the invoices by TrustBills and the definition of the key data of the auction, you can start an auction manually or automatically. After that, you will no longer have to intervene because, once the auction has been successfully completed, you will automatically receive the purchase price transferred onto your bank account. In addition, you will receive the related information for the accounting record to be used in your ERP-System. At maturity of the invoice, TrustBills automatically takes care of forwarding the payed amount to the investor.
What is the duration of an auction?
There is the possibility to run auctions 1, 3 or 7 calendar days.
Is it possible to terminate an auction?
A running auction can only be stopped in exceptional cases. As soon as you start an auction, you are obliged - except in these exceptional cases - to sell the trade receivable to the highest bidder. Please see our platform conditions for the exceptions.
What happens, if a trade receivable has not been purchased?
You will be informed by e-mail that your trade receivable has not been sold at the minimum price that you had set. If you wish, you will then be able to post the trade receivable again for auction and only pay a reduced "posting fee“. You can re-post your trade receivable as often as you like.
Is there a “Buy Now” option?
A "Buy Now" feature is currently unavailable. If you miss such a function, please send us an e-mail and we will consider whether we shall offer such a function for our users in the future.
What happens when the debtor pays my invoice before due date?
TrustBills starts to monitor the invoice reception accounts already 5 bank-working days before the actual due date of an invoice. If an early in-payment cannot be registered automatically, you will be notified. In such a case, you will be kindly asked to control if you have already received the in-payment and inform us accordingly.
What happens if the debtor does not pay the trade receivable completely?
In addition to the debtors' payment or insolvency risk, the investors also take the risk of the payment behaviour (dilution- and late payment risk) of the debtor. All these risks can be assessed by the investors based on the available payment data on TrustBills. In principle, the sellers of receivables are liable for 100% of the existence and certainty of receivables . The sellers can, however, opt to limit their guarantee to 80% of the nominal value of the invoice. This implies that for discounts of up to 20% of the face value of the invoice due to e.g. defences, off-sets, etc., the seller is not obliged to compensate the buyer for the difference. This risk is measurable by the monitoring of the payment flows as well as the typical payment behavior. If, on the other hand, the actual payment of the invoice amounts to less than 80%, the buyer can ask the seller for the reimbursement of the whole amount. The reason for this is that in case of discounts of more than 20% it can be assumed that the seller was already aware of problems with the goods/service and should therefore be liable for 100% of the invoice amount.