Confirming in Peru: The Ideal Solution for Optimizing Supplier Payments

In Peru’s competitive business environment, timely payments to suppliers are key to maintaining solid commercial relationships and an efficient supply chain. However, many companies face challenges managing their accounts payable without compromising liquidity. In this scenario, confirming emerges as a smart and effective financial solution. In this article, we explain what confirming is, how it operates in Peru, and why it can become a strategic tool for your business.

What is Confirming and How Does It Work?

Confirming is a financial service that allows companies to manage their accounts payable through a financial institution. Instead of the company paying its suppliers directly, it delegates this function to a third party that notifies suppliers and—if they choose—advances the payment of their invoices before the maturity date.

The confirming process works as follows:

1. The company (the issuer) contracts the confirming service with a financial entity.
2. Data for approved invoices to be paid is uploaded to the system.
3. The supplier receives notification of the confirming offer and payment terms.
4. The supplier decides whether to wait until the maturity date or request an early payment.
5. The financial entity provides the advance payment, minus a small commission.
6. On the due date, the issuing company pays the full invoice value to the financial entity.

How Does Confirming Operate in the Peruvian Context?

In Peru, confirming has gained popularity in recent years as a financial support tool for both large corporations and SME suppliers. Thanks to advancements in digitalization, many confirming operations are now managed electronically, allowing for greater agility, transparency, and traceability.

The Peruvian legal framework allows for the validation and assignment of electronic invoices, which has facilitated the implementation of confirming as an indirect financing alternative for suppliers.

Benefits of Confirming for Companies

• Agility and Payment Automation: The company delegates payment management, reducing administrative and operational workloads.
• Better Cash Flow Control: Confirming allows for more precise payment planning, maintaining liquidity without incurring early payouts from the company’s own capital.
• Increased Transparency: Suppliers gain clarity on payment terms and conditions, avoiding confusion or disputes.
• Strengthened Commercial Relationships: Offering suppliers the option to collect early builds trust and stability within the supply chain.

Benefits of Confirming for Suppliers

Confirming also represents a competitive advantage for suppliers, especially for Micro, Small, and Medium Enterprises (MSMEs):

• Immediate Liquidity: Suppliers can advance their invoice collections without needing to apply for bank loans or provide collateral.
• Payment Security: Knowing that the invoice has been approved by the issuing company and that payment is guaranteed provides financial peace of mind.
• Reduced Commercial Risk: Lower risk of non-payment, as the transaction is channeled through a financial entity.
• Improved Financial Management: Having access to early cash flow allows suppliers to plan purchases, investments, or fulfill their own obligations.

Which Companies Can Leverage Confirming in Peru?

Confirming is ideal for businesses that manage a significant volume of supplier payments and wish to maintain a strong commercial reputation. It is especially beneficial for:

• Retail Sector: Companies working with hundreds of suppliers.
• Construction: Firms managing large supply chains.
• Agribusiness: Businesses with cyclical payment needs.
• Manufacturing: Companies seeking operational efficiency.

How to Choose a Reliable Confirming Service in Peru?

When selecting a confirming provider, it is important to evaluate:

• Clarity and Transparency: All conditions, rates, and commissions should be detailed from the start.
• Market Experience: Companies with a proven track record offer more solid and efficient services.
• Personalized Support: Having an advisor who understands the specific nuances of your business.
• User-Friendly Technology: Digital platforms that allow for fast, secure management without complex paperwork.

PAN AMERICAN: Confirming Tailored to Your Needs

At PAN AMERICAN Financial Services, we offer a confirming service adapted to the needs of each client, featuring clear terms, personalized attention, and technological tools that streamline the entire process.

Confirming has established itself as an effective solution for companies looking to optimize payment management and strengthen their bond with suppliers. By providing liquidity without compromising the company’s financial stability, it ensures smooth operations and long-term commercial success.