Product Overview
Purchase Order Financing helps you fulfill large orders from reputable buyers by providing upfront funding (typically 80-90% of the order value) so you can manufacture or procure goods and deliver on time. When your buyer pays, we automatically recover the loan plus interest.
⚠️ Eligibility Requirements
Before applying, ensure your business meets these minimum requirements:
✅ Location: Operating in Lagos State (mandatory)
✅ Monthly Turnover: Between ₦1 million and ₦100 million
✅ Operating History: At least 2 years in business
✅ Business Registration: Legally registered business entity (Sole Proprietorship, Partnership, or Corporation)
✅ Business Banking: Dedicated business account with 6+ months history
✅ Industry: Operating in an approved industry sector (see below)
✅ Financial Separation: Personal and business finances must be separate
⚠️ Important: Kuda Business loans are only available to businesses operating in Lagos State. If your business operates outside Lagos State, you are not eligible for our business loan products at this time.
Approved Industries
We provide Purchase Order Financing to businesses in the following sectors:
Primary Target Markets:
- Accommodation and Food Service Activities
- Hotels and accommodation services
- Restaurants and food services
- Cafes and bars
- Wholesale and Retail Trade
- Wholesale trade (except motor vehicles)
- Retail trade (stores, mini-marts, convenience stores)
Secondary Target Markets:
- Information and Communication
- Agriculture, Forestry and Fishing
- Administrative and Support Service Activities
- Manufacturing (ISIC Section 3) - Food, beverages, textiles, and apparel
Note: If your industry is not listed above, please contact [email protected] to discuss eligibility.
How It Works
1. You get a big order from a reputable buyer - A confirmed purchase order for goods or services you need to deliver
2. You apply for financing - Email [email protected] with your purchase order details and business information
3. We assess the opportunity - We verify the buyer, review your business history, and evaluate the purchase order
4. If approved, we provide funding - We typically advance 80-90% of the confirmed purchase order value directly to your Kuda Business account
5. You fulfill the order - Use the funds to manufacture, procure, or deliver the goods/services as specified in the purchase order
6. Buyer pays into your account - The buyer makes payment directly into your Kuda Business account as agreed
7. Automatic repayment - We automatically recover the loan amount plus interest from the payment received
Ready to take on that big order? Email [email protected] and let's get started!
Who's It For?
Purchase Order Financing is ideal for:
- Manufacturers who receive large orders but need capital to purchase raw materials or cover production costs
- Wholesalers and distributors with confirmed orders from reputable buyers
- Service providers with signed contracts requiring upfront investment
- Growing businesses that need to scale operations to fulfill larger orders
- Established businesses (2+ years) with proven track records and reputable buyers
Key Requirements:
- Business must operate in Lagos State
- Monthly turnover between ₦1m - ₦100m
- Confirmed purchase order from a verified, reputable buyer
- Ability to fulfill the order within agreed timelines
The Nitty-Gritty
Financing Details
Advance Rate:
- Typically 80-90% of confirmed purchase order value
- Final percentage depends on:
- Buyer creditworthiness and payment history
- Order size and complexity
- Your business track record and financial health
- Industry risk factors
- Delivery and payment terms
Tenor:
- Aligned with the delivery and payment terms of your purchase order
- Typically matches the time from order fulfillment to buyer payment
- Usually ranges from 30 to 120 days, depending on the order
Repayment:
- Automatic deduction when buyer payment is received into your Kuda Business account
- No manual repayment required
- Interest calculated on the actual funding period
Buyer Requirements
For your purchase order to qualify, the buyer must meet these criteria:
- Verified Company: Buyer must be a legitimate, registered business entity
- Reputable Track Record: Buyer should have a history of honoring payment obligations
- Confirmed Purchase Order: PO must be valid, confirmed, and legally binding
- Payment Agreement: Buyer must agree to pay directly into your Kuda Business account
- Credit Assessment: We will assess the buyer's creditworthiness and payment history
What makes a "reputable buyer"?
- Established business with verifiable track record
- Good payment history with suppliers
- Financially stable and creditworthy
- Clear payment terms and commitment to honor the purchase order
Purchase Order Requirements
- Minimum PO Value: Contact [email protected] for current minimum thresholds
- Valid and Confirmed: PO must be signed, dated, and confirmed by the buyer
- Clear Terms: Delivery timelines, payment terms, and specifications must be clearly defined
- Legitimate Business Purpose: Order must be for legitimate business activities
Things to Know
Benefits
✅ No Collateral Required: Purchase order serves as security
✅ Fast Access to Funds: Quick approval and funding process
✅ Automatic Repayment: No manual repayment needed
✅ Scale Your Business: Take on larger orders without depleting working capital
✅ Build Buyer Relationships: Fulfill orders from reputable buyers confidently
Important Considerations
⚠️ Buyer Payment Risk: If the buyer fails to pay, you remain responsible for the loan
⚠️ Order Fulfillment: You must deliver exactly as specified in the purchase order
⚠️ Timeline Commitment: Delays in delivery may affect repayment terms
⚠️ Documentation: Complete and accurate documentation is required for approval
Frequently Asked Questions
Q: What percentage of the purchase order value can I get?
A: Typically 80-90%, depending on buyer creditworthiness, order size, your business history, and other risk factors.
Q: How long does the approval process take?
A: Typically 5-10 business days from complete application submission, depending on complexity and documentation completeness.
Q: What happens if the buyer doesn't pay?
A: You remain responsible for repaying the loan. We assess buyer creditworthiness before approval to minimize this risk.
Q: Can I use this for multiple purchase orders?
A: Each purchase order is assessed individually. Contact [email protected] to discuss multiple orders.
Q: Do I need collateral?
A: The purchase order typically serves as security, but additional collateral may be required depending on risk assessment.
Q: What if I can't deliver on time?
A: Contact us immediately. Delays may affect repayment terms, and we'll work with you to find a solution.
Q: Can I get financing for purchase orders from new buyers?
A: Yes, but we'll need to verify the buyer's creditworthiness and may require additional documentation.