Business finance company Earlypay has issued A$30 million of notes to fund its move into the trade finance market.

The notes were issued via a new facility – the Earlypay Trade Receivables Trust, a special purpose vehicle secured by trade credit receivables.

The issue was arranged by Income Asset Management (formerly Cashwerkz) with a floating rate of 600 to 650 basis points over the one-month bank bill swap rate and a 2026 final maturity.

Earlypay’s core business is invoice finance. In 2020/21 it launched a trade finance product, figuring that it is a complementary offering for its customer base. It offers trade finance to qualifying invoice finance clients for the purchase of stock.

Earlypay chief executive Daniel Riley said in a statement that the new facility would allow the company to compete for bigger transactions while maintaining its margin.

Riley said the invoice finance facility repays the trade loan when stock is sold, which mitigates the risk of arrears.

The company has also increased its invoice finance capacity recently. Last month it secured an increase in the facility limit of its primary invoice finance warehouse, taking it from A$125 million to $200 million. 

The company reported in its December half financial result that invoice finance volumes rose 35 per cent, compared with the previous corresponding period, to $1.2 billion.