The spending management provider Ariba Inc. hopes to improve access to financing for its network of corporate users through a partnership with the Receivables Exchange, an auction Web site for business-to-business invoices.
Ariba, which formed alliances this year with Citigroup Inc. and Bank of Montreal to offer its spending management software and services to their corporate clients, said its deal with the Receivables Exchange, announced Tuesday, would provide an alternative way for companies to finance their operations in the current credit crunch when banks will not finance them.
Drew Hofler, Ariba's senior manager of financial solutions, said the Receivables Exchange fills a hole in his Sunnyvale, Calif., company's lineup of supplier financing tools.
"What we were missing was the ability for the buyer to go directly to the liquidity provider, without having to wait for the buyers to invite them in," he said.
Though Ariba users have access to the auction site now, both companies said they plan tighter integration of their computer systems.
"When it comes from the Ariba network, it's unalterable data. It's locked down. It's safe," Mr. Hofler said. "We think that is a special value to the liquidity providers because of the transparency."
The partnership promises to link Ariba's network of 160,000 suppliers with the Receivables Exchange's auction site for capital providers.
The Receivables Exchange, of New Orleans, officially launched the site in November, after beginning sales efforts in April.
It provides a system through which investors — including factoring companies, bank asset-backed lending units, and hedge funds — can bid to purchase receivables accounts from corporate suppliers.
Nicolas R. Perkin, a co-founder and the president of the Receivables Exchange, said the alliance would particularly benefit to small and midsize enterprises that are willing to sell their receivables to receive payments faster.
"It really is a brand-new day for commercial finance in the United States," Mr. Perkin said.
"It's not a commercial paper market but a commercial receivables market for the SME category," he said. "You really are talking about an entirely new way for companies to access working capital, and it's available to everybody."
