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Necessity of Supply Chain Financing in Healthcare Sector

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Science and technology have made great leaps and strides to impact the quality of healthcare. With this in mind, you might recall from our previous blog Simplifying Supply Chain Financing for a Hospital that hospitals and the players in their chain of operations face various bottlenecks. Let’s check in again with the players in the supply chain we visited in our last blog – FeelWell Hospital and their supplier, Med-Suppliers Ltd. to see how their operations are coming along.

FeelWell has spent significant time and funds purchasing medical equipment and supplies, distributing medical necessities, and scheduling patient services. To ease the working capital logjams they encounter on the way, Care.fi has built CareCred – a simple and innovative cash flow-based lending platform that takes care of a hospital’s credit needs. CareCred manages these credit needs by optimizing and accelerating cash flows. By this, we mean that CareCred essentially extends short-term finance to dealers and suppliers that are part of the value chains. By using CareCred’s key features, workflow and cash flow seem to be operating more smoothly at FeelWell !

“Okay… But what about Med-Suppliers? How could CareCred help small stakeholders like them?” We hear, You ask.

By using CareCred, MedSuppliers Ltd is thriving too! This is because we not only provide them upfront credit but also the facility of managing all their healthcare-providing clients’ invoices financed by Care.fi in one convenient place!

“But why exactly is this necessary?”

“How big could this problem be for it to require CareCred’s intervention?”

And most importantly - “Can CareCred successfully solve these cash flow problems?”

We’re glad you asked!

The Problem
Out of the 280 Billion dollars that India’s healthcare market is estimated to spend, over 50 Billion dollars of this sizable chunk is used to clear Operating Expenses alone. This OpEx amount is not financed by conventional lenders, as the process tends to be tedious. With supply-chain financing, CareCred fills up the cash flow gaps in the supply chain. OpEx, or the cash flow mentioned above, is the literal flow of money continuously paying for the company’s day-to-day expenses. While Healthcare institutions get comparatively easier access to credit for CapEx, getting credit for OpEx is not that hassle free.

As explained in our previous blog, OpEx bill often runs into large numbers (~1 Mn dollar for a large hospital). While supplier procure goods from manufacturers by paying upfront, they gives these goods to hospitals/healthcare institutions on credit tenure of 30-90 days. But for this tenure, the Supplier cannot access this money and faces working capital crunch.

This is where Care.fi comes in and with our financing platform, CareCred , suppliers get upfront payment. Thus they can get:
✅Liquidity for inventory purchasing📦
✅Increased wallet share with existing hospitals / collaborate with new hospitals 🏥

Here at Care.fi, we work towards transforming the healthcare supply chain with our expertise in the sector, grasp of technology, and amazing team :)

Still confused? We’re here to help! Simply reach out to us at sidak.singh@carefi.in, and we’ll be back in touch soon.


Still have questions? Reach out to info@carefi.in and we’ll be in touch with you soon.💡