Q&A: How the new VINPay fast track payment service from VINEX works

This month VINEX has launched its new VINPay fast track secure payment service that guarantees payment and allows producers to get access to 80% of their invoice within three days of their dispatch to an approved buyer. Here we explain just how the new payment system works and what the cash flow benefits are to both buyers and producers.

How does it work?
Producers can choose to VINPay their invoices and receive an 80% advanced payment within three days of dispatching their wine, and be guaranteed 100% payment. The balance is paid by VINPay within three days of the invoice due date (being either 60 or 90 days from dispatch).

The buyer must be VINPay approved, and located in the US, UK or Europe. VINPay is available to suppliers located in any country.

The supplier copies VINPay when issuing their invoices, and needs to provide a proof of dispatch. The buyer pays the supplier's original invoice on or before the due date paying to a nominee bank account owned by VINPay, and a receipt of payment is issued.

One VINPay fee is paid by the supplier to receive guaranteed and earlier payment, which is deducted from the 80% advanced payment. The buyer has an option to pay an extension fee to add a further 60 days to the invoice due date, to a maximum of 150 days.

How is VINPay able to cover 80% of the payment within three days?

VINEX has been able to secure funding in excess of £20 million in order to provide this fast track secure payment service to suppliers. There is also no interest paid on the advanced payment, just one scheduled fee.

Is VINPay only available if I trade through VINEX?
No. All suppliers (and buyers) can choose to VINPay invoices for their existing direct transactions, provided the buyer is VINPay approved. However, if they do trade through VINEX and want to VINPay the invoices, there’s no VINEX trading fee.

How much is the VINPay fee?
There is a fee scale, with a discount for a minimum annual commitment. The fee is deducted by VINPay from the 80% advanced to suppliers and starts from 1.6% (for 60 day invoices) and 2.4% (for 90 day invoices) inclusive of credit insurance. Buyers can also choose to extend their invoice payment by 60 days from 1.6%, potentially up to 150 days.

Does VINPay hold security over my wine or assets?
No. VINPay is secured by its own trade credit insurance arrangements. The funding provided is unsecured, off-balance sheet and not related to your bank finance arrangements. Typically bank finance fees are lower than VINPay, but banks take security over your wine and winery assets and don't guarantee you 100% payment in the event the buyer doesn’t pay.

Is VINPay restricted to certain buyers?
Yes. Buyers must be located in US, UK or Europe and VINPay credit approved. Many of the larger buyers are already approved, and the approvals list is growing. You can email VINPay to ask if your buyer is approved.

Can anyone use VINPay?
VINPay is available to all registered VINEX sellers who have legal ownership of the wine and clear title to transfer the wine. Buyers must also be VINEX registered and approved.

Do I need to sign an agreement?
Yes. All transactions operate under a rolling tri-partite agreement, between the supplier, the buyer and VINEX.

Can I get paid in my local currency?
Invoices can be settled in the supplier’s major currency, either EUR, USD, AUD, NZD or ZAR. Buyers can also choose to agree a ROX and pay in their local currency, either USD, EUR or GBP.

What is a Combo?
The lowest combined VINPay fee is available when the buyer agrees to extend a supplier’s invoice due date, eg. from 90 days to 150 days. If suppliers choose to offer this extension to their buyers (or VINPay can offer it on their behalf) and they accept, then suppliers benefit from the lowest scheduled VINPay fee, called a Combo Fee.

Can I VINPay a bunch of my invoices for wine already dispatch (or received)?
No, VINPay is not a factoring service. VINPay is available for all forward dispatches to approved buyers.

Do I offer my buyer 60 or 90 days to pay?
Most buyers purchasing supply from the Southern Hemisphere will want 90 day payment terms, however, there are some exceptions. Most buyers within the US or Europe will be pleased to receive 60 day payment terms. VINPay does not offer 30 day terms. Many buyers purchase a 60 days extension to pay, and suppliers can offer this option when agreeing to a sale.

If a buyer extends payment of a supplier’s invoice by 60 days, does this mean the 20% balance payable by VINPay to the supplier is not paid until the buyer eventually pays?
No. Suppliers are paid the balance of their invoice within 3 days of the original invoice due date, guaranteed.

Can I use VINPay for credit insurance cover only, to be guaranteed payment?
No. All VINPay transactions encompass the 80% cash advance and 100% guaranteed payment.

How do I find out if my buyer is VINPay approved?
Email VINPay and provide the buyer's company name. If not registered and approved, VINpay can approach the buyer on your behalf, with your permission.

What if the buyer doesn’t pay VINPay?
VINPay still pays the supplier. VINPay is responsible for collecting all invoice payments, provided the supplier has met the supply conditions and specifications, and VINPay received a signed Proof of Acceptance from the buyer.

Who’s behind VINPay?
Vin-Exchange Ltd (“VINEX”) created the VINPay secure digital payments platform through their company VINEX Software Ltd. The platform complies with UK, EU & US financial payments and privacy regulations.

How do I start?
* Email us to check if your buyer is VINPay approved.
* VINPay will send you an agreement for your review and acceptance, and then forward it to the buyer to accept. It's a rolling agreement that can cover all transactions. VINPay will also ask your buyer to sign a Proof of Acceptance, assuming they have received a wine sample (or previous shipment) and agree to take delivery, as sampled.
* When the supplier loads and dispatches the wines, they need to copy VINPay on their issued Invoices and provide a Proof of Dispatch document.
* VINPay pays 80% of the invoice(s) within three days. The 20% balance is paid within three days of the invoice due date, regardless of whether or not the buyer has chosen to extend their payment by a further 60 days.

Email VINPay at: enquiry@vinpay.market