U.S. Bank, the fifth-largest commercial bank in the United States, and FuelQuest Inc., the leading on-demand software and services company for the global downstream (refined products) energy industry, announced a strategic partnership that provides credit market relief to suppliers, marketers, distributors, retailers and commercial customers of fuel. Called U.S. Bank Fuel Financing, the service extends buyer payment terms and accelerates supplier payments for rack-based (wholesale) fuel purchases. Buyers gain additional cash flow and greater access to credit while suppliers reduce business risk and shorten days sales outstanding (DSO).
“Significant inefficiency exists in the procurement and payment processes of the downstream oil and gas industry,” said Ramel Lindsay, U.S. Bank fleet product manager. “Credit markets also remain tight, inhibiting growth and creating unnecessary costs for buyers and suppliers of fuel. With Fuel Financing, U.S. Bank addresses these issues by assuming payment risk and offering transacting parties more favorable terms that improve capital efficiency.”
With $355 billion in assets and strong banking experience in oil and gas markets, U.S. Bank is uniquely positioned to bring this innovative credit service to market. U.S. Bank Fuel Financing utilizes flexible financing options and FuelQuest’s invoice processing capabilities to give buyers:
• improved cash flow with payment terms extending past traditional Net 10
• maximized purchasing power across multiple sellers via a single line of credit
• increased business growth opportunities through greater access to credit
• lower financing costs through reduced letters of credit and deposits.
Suppliers who subscribe to the solution gain:
• increased sales via extended lines of credit
• lowered DSO and greater balance sheet stability with next-day payment terms
• reduced exposure to customer default and need for trade insurance programs
• decreased underwriting and collections costs.
Fuel Financing is currently available to select buyers and sellers. Organizations interested in adopting the service should contact U.S. Bank or FuelQuest to learn more.
"Buying and selling just became easier with U.S. Bank Fuel Financing,” said Matt Tormollen, president and CEO of FuelQuest. "Buyers improve cash flow, reduce fuel costs and gain access to additional credit while sellers accelerate speed of payment and dramatically reduce default risk. We are proud to team with a strong leader like U.S. Bank and help them solve a major pain point in the market today.”
Originally posted on Automotive Fleet