finance offered to supplier by
financial entity, enabling company to pay at term and supplier to collect on
delivery. The term 'confirming' was coined by the Spanish banks and is not to
be confused with confirmation of letters of credit (see trade finance section).
Details of payments to certain agreed suppliers are passed on to
the bank, who will arrange to pay the supplier at the due date. At the same
time, the bank will communicate to the supplier that they are handling payment,
and offer to discount the payment up front at an agreed interest rate. If the
supplier accepts, he returns the signed agreement and receives the discounted
This type of financing may be of interest to
companies who normally pay suppliers on extended terms of 60 days or over.