Purchase order funding helps a business cover agreed supplier costs for an awarded order before the buyer pays. The purchase order proves what the buyer has ordered; it is different from a supplier quotation, delivery record or invoice. This beginner’s guide explains those records, the cash gap and the responsibilities in a funding agreement.
Start with Fund The People for a qualifying government or municipal tender-linked order. Our own in-house Purchase Order Funding Solutions support the supplier-cost stage before delivery. For eligibility, use our PO funding eligibility guide; for document consistency, use our application-pack checks.
Fund The People funds South African SMMEs directly through our own in-house Purchase Order Funding Solutions, Tender Funding Solutions and Invoice Discounting Solutions. This beginner’s guide explains the key terms. For a qualifying awarded government or municipal order, explore our Purchase Order Funding Solutions.
The four records behind a purchase-order funding enquiry
A purchase order records what the buyer has ordered from your business. A supplier quotation records what it will cost your business to obtain the goods or inputs. A delivery record helps establish what was supplied and accepted. An invoice requests payment for the relevant work or goods. These records serve different purposes and should refer to a consistent transaction.
The order value is your selling value. It is different from the supplier cost and different again from the amount requested for funding. If an order is worth R600,000 and the supplier quotation is R420,000, those two figures describe different parts of the deal. Transport, installation and other delivery costs may also need to be accounted for. This illustration is not a funding offer or a statement of Fund The People’s charges.
What does the funding gap mean?
The funding gap is the amount your business needs before the buyer pays, after taking account of resources already available. Start with the supplier quotation, identify the payment dates and add any other costs needed to deliver. Keep all amounts on a consistent basis so that tax, delivery charges or optional items do not get counted twice.
A larger order does not automatically require funding for its entire selling value. Explain which costs need to be covered and when. The proposed Funding Solutions agreement identifies the amount considered, the covered costs and your business’s responsibilities. Preparing this explanation helps you ask a clear question without needing to know every finance term.
Who is involved in the transaction?
Your business holds the awarded order and carries the delivery obligation to the buyer. The supplier provides the agreed goods or inputs. Fund The People assesses the qualifying transaction and provides our own in-house Funding Solutions. Approved supplier payments follow the agreed arrangement.
The buyer’s procurement process remains separate from the funding assessment. A supplier being listed in a portal, or an institution appearing on a partner page, does not replace the order and application records. Read our official funding-model information for the relationship between our services and delivery support.
Before delivery and after delivery are different stages
Our Purchase Order Funding Solutions address qualifying supplier requirements before delivery. Our Tender Funding Solutions support qualifying awarded tender work. Our Invoice Discounting Solutions relate to qualifying unpaid invoices after completed and accepted work.
Identify your current stage before choosing a service. If you are still searching for work, opportunity discovery is the task. If you hold an awarded order and need supplier payment, discuss the order. If the work has already been accepted and the invoice remains unpaid, explore our Invoice Discounting Solutions.
Read the proposed costs and payment arrangements
Ask what amount will be covered, what charges apply, when supplier payments can be released and how buyer proceeds will be settled. Also identify costs your business will provide separately. The agreement should make these points understandable in the context of your actual order.
Funding creates responsibilities under an agreed arrangement. It should not be described as having no repayment obligations or creating no debt in every case. Likewise, a funding approval and a supplier payment are different events. The approved terms explain how the transaction progresses.
Once these terms are clear, our guide to selecting a purchase order funding provider explains how to check buyer eligibility, supplier-payment terms and total costs when deciding where to apply.
Prepare your first application
- Check the awarded order’s buyer, appointed business, reference, scope and delivery date.
- Obtain current supplier quotations that match the order’s specification and quantities.
- Organise company and CSD information for the government or municipal route.
- Identify the supplier-cost gap, other delivery costs and the dates when payment is needed.
- Submit the records to Fund The People and discuss the proposed terms with our team.
Why Did 3000+ SMMEs Choose Fund The People?
Fund The People has supported 3,000+ South African SMMEs since January 2025. The support figure covers business support and engagement; it is not a count of funded deals. Our direct in-house Funding Solutions work alongside end-to-end supply chain support with 1,000+ vetted, accredited suppliers.
Our deal range is R250,000–R8 million and above, with funding approval within 48 hours for complete qualifying applications. Bring your awarded order and current supplier records to our Funding Solutions application.
Frequently asked questions
What are Purchase Order Funding Solutions?
Our Purchase Order Funding Solutions help a qualifying business address agreed supplier costs for an awarded order before the buyer pays. Fund The People provides these solutions directly in-house. The order, supplier quotations and delivery requirements give our team the information needed to assess the transaction.
Is the purchase order the same as an invoice?
No. The purchase order describes the buyer’s awarded requirement, while an invoice requests payment for the relevant goods or work. A supplier quotation is another separate record: it shows the costs your business expects to pay. Keep the references, specifications and amounts consistent across your application.
Does funding cover the whole value of the order?
The selling value and funding requirement are different figures. The proposed arrangement identifies the supplier costs and other agreed amounts covered. Explain the actual gap and identify any contribution your business must make, rather than assuming the entire order value will be advanced.
How quickly does Fund The People approve funding?
Fund The People provides funding approval within 48 hours for complete qualifying applications. Approval is separate from releasing a supplier payment. Our team confirms the payment arrangements and release conditions for the approved transaction.
What should a first-time applicant read next?
Use the supplier-payment workflow guide to understand assessment, approval, delivery and settlement. Use the PO versus tender comparison to identify your commercial stage. Our main Purchase Order Funding Solutions page and application provide the next step for a qualifying awarded government or municipal order.