Technology-Driven Risk Management & Security Structuring

Apxium’s Payments Acquiring accreditation means it replaces each Accounting Firm’s transactional banking relationship (i.e., Apxium offers the same payment rails as banks but in a more innovative and cost-effective manner that is fully data integrated with Firms’ Practice Management Software). Combined with innovative Accounts Receivable Automation software, Apxium acts as the Firm’s Collections Agent, managed per the following funds flow explanation:

1. Apxium provides each Firm with a Payment Gateway through which their client debtors can pay their invoices (accounting fees).

2. Under Apxium’s Professional Fee Funding model, an Accounting Firm can offer its clients the ability to pay under standard invoice terms or via ‘instalments at a premium’ for up to 12 advance monthly instalments (11 actual full months)—directly via an embedded payment link on the invoice.

3. Apxium does not extend any funding to an Accounting Firm until its client debtor has made its first instalment payment, which includes all interest and fees in advance. As part of the client debtor’s first instalment, Apxium collects all fees/premium (i.e., implied interest - in advance for the entire debt), along with the first principal repayment, prior to advancing funds to the Accounting Firm for 100% of the invoice Face Value. This ensures that the client debtor has legally accepted the invoice, thereby mitigating the risk of a dispute.

4. Loan funds are then settled to the Accounting Firm’s collections bank account, over which Apxium also holds a Direct Debit Authority.

5. This Direct Debit Authority enables Apxium to automatically effect a chargeback to the Firm’s bank account to rectify any instalment arrears associated with any particular invoice on which Apxium may have extended debt.

6. This also allows Apxium the right to divert all of the Firm’s collections/monies (‘Right of Offset’) that are managed by Apxium’s Accounts Receivable Automation software (circa 90% of an Accounting Firm’s entire revenues), regardless of whether these invoices were funded by Apxium or not. This security structure is enhanced by an Equitable Assignment over the Firm’s entire invoices.

7. By the time a Firm offers an instalment arrangement to its client debtor, Apxium has already identified this debtor with access to its historical accounting fee payment performance. I.e., Apxium provides the Firm with the Payment Gateway through which each client debtor pays its accounting fees. Apxium is also fully data-integrated with the Firm’s Practice Management Software, providing real-time visibility over each invoice and client debtor performance.

8. Apxium collects the remaining instalments (principal repayments) from the client debtor after having already collected fees and interest up front.

9. Apxium also implements a Direct Debit Authority over the Accounting Firm’s client debtor’s account as part of the acceptance process of the instalment arrangement/agreement. Apxium also has the right to legally pursue the Firm’s client debtor (‘Right to Perfect Title’) in the unlikely event that the Firm faces insolvency and is unable to recover outstanding debt from rerouting all other invoice payments (those that haven't been funded by Apxium) to itself via its 'Right of Offset' arrangement.

This technology driven risk and security structure has been proven and validated over 8 years of its existence, with an impressive 0% historical loss rate.

Professional Fee Funding - Credit Risk Structuring