Dynamic discounting
Dynamic discounting allows buyers to pay invoices early in exchange for a discount, creating a flexible and mutually beneficial payment arrangement.
Dynamic discounting enables buyers to pay invoices ahead of their due date in return for a negotiated discount. The discount rate varies based on how early the payment is made, benefiting both parties.
Example: A vendor offers a 2% discount if an invoice due in 30 days is paid within 10 days. The buyer saves money on the invoice while the vendor improves its cash flow.
