Exploring the relationship between mechanisms, actors and instruments in Supply Chain Finance:A systematic literature review

Abstract

Supply Chain Finance (SCF) deals with the management of financial flows along the supply chain. Its core objective is to facilitate the reduction of financial risk in a supply chain by improving the collaborative cash-to-cash cycle and working capital. In order to fulfil its objective, SCF involves the coordination of supply chain actors, SCF instruments, and supply chain processes. Existing studies focus either on SCF actors, such as buyers, suppliers, banks, and logistics service providers (LSPs), or on specific SCF instruments, such as reverse factoring, inventory financing and discounting. However, an analysis of the relationship between actors and instruments, as well as of the factors influencing this relationship, requires further development. In light of this gap, this paper systematically reviews the literature on SCF with the objective of clarifying the relationship between SCF actors, instruments, and contextual factors. The review identified three main archetypes for this relationship: fixed-asset financing (fixed asset-centric), inventory financing (inventory-centric), accounts receivable/accounts payable financing (buyer-centric and supplier-centric). Based on the results of the review, the authors discuss the implications for practitioners and further research for academics.