The relationship between businesses and their suppliers consists mainly of 2 flows:

• suppliers deliver a good, tool or service to the business (customer): trade flow;
• businesses (customers) pay their suppliers in exchange for this delivery: financial flow.

To manage and optimise the relationship between businesses and their suppliers, banks make a wide range of means of payment available to businesses. They can use these means in their business relationships, vis-à-vis both other professionals and end customers.

Below is a non-exhaustive list of the means of payment available:

• cash payment;
• domestic/international transfer and standing order;
• direct debit;
• payment cards;
• cheque;
• bill of exchange;
• online payment (MultiLine);
• optimisation of flows and expenses with foreign subsidiaries of international banks.

Paying invoices in cash

Cash payments are carried out using bank notes or change.

A bank note is a bill issued, in principle, by the central bank of a monetary zone (e.g. a country or the eurozone) representing a certain number of monetary units. A bank note is legal tender, i.e. a creditor is obliged to accept it as payment for what it is owed, regardless of the amount in question.

Change refers to all of the coins that are made from low-value metals. These coins represent a certain monetary unit with no relation to the value of the metal they are made of. Coins are legal tender.

Objective: cash is used to settle (pay) all types of invoices regardless of the underlying commercial consideration (purchase of movable or immovable assets, delivery of goods, tools, machinery, services, etc.).

Who is concerned?

Available to the self-employed and any type of business, cash payments apply in the following cases:

• payment of various taxes when setting up a business and during the business’ operating cycle;
• purchase of small maintenance tools in shops;
• cash payment of suppliers in order to benefit from discounts;
• preliminary sale agreement for a property purchase which requires the payment of a deposit.

What are the prerequisites?

The business must have sufficient cash and the beneficiary must have the exact change to make up the difference between the notes and the amount due.

How to proceed?

Application terms and conditions

• hand over the amount in question to the creditor;
• send the amount by post in an insured envelope (sum in bank notes, envelope sealed with wax, value written on the envelope);
• deposit funds at the Post Office which then pays the beneficiary. In this case the debtor uses a money order which can be an ordinary postal order (payable at the counter of the Post Office in the beneficiary’s town/city) or a money order payable at the place indicated thereon.

Payment time frames

There is no specific deadline for cash payment, as it is carried out at the time of delivery of the merchandise or service.

Advantages, disadvantages and risks

Advantages

• rapid payment of the debt and receipt of the receivable;
• large discounts may be obtained from suppliers;
• no subsequent payment monitoring;
• no charges.

Disadvantages

• one or more cash boxes containing sufficient money to be kept and managed;
• debit interest not received;
• difficult to monitor for accounting purposes.

Risks

Loss or theft of money.