Accounts Receivable Purchases Programs
What Is ARPP?
The non recourse sale of a customer's trade receivables to BTMU at a discount. BTMU will fund trade receivables where the obligor is an existing client of the bank. The customer benefits from low-cost off-balance-sheet funding and the mitigation of payment risk.
Key Benefits of ARPP
- Mitigation of payment risk
- Non-recourse to the seller
- Diversification of funding
- Off-balance-sheet funding
BTMU's ARPP Objective
Our objective is to provide customers the opportunity to sell a concentrated portfolio of specific obligors (usually existing clients of BTMU) with the underlying purchase price primarily related to the obligors' credit rating. BTMU has capability to finance concentrated portfolio of specific obligors in addition to the finance to diversified pools. This sale of receivables can be structured to allow the seller to achieve off-balance-sheet treatment.
BTMU's ARPP Business
BTMU has closed ARPP transactions for sellers globally, and in many cases these are across jurisdictions. Because BTMU has such an extensive Japanese corporate client base, the bank is ideally situated to buy receivables where the obligor is a Japanese name. As of June 2014, BTMU currently funds more than 550 ARPP transactions with an exposure of over US$16 billion.