Orbian is a joint venture between Citigroup, DCE, and SAP to launch an electronic payment system for online business purchases called Orbian Credits. Orbian Credits allow buyers to defer payment to suppliers by issuing the suppliers an Orbian Credit, which can be redeemed for cash from Orbian at a later maturity date. This fulfills the conflicting needs of buyers to defer payment and suppliers to quickly access funds. SAP has integrated the Orbian payment process into its mySAP Financials solution to allow automatic payment processing using Orbian Credits. The Orbian system provides benefits to both buyers and suppliers through reduced financing costs, increased liquidity, and streamlined payment processing.

1. Article
E-Financing and Settlement with mySAP.com:
Electronic Trading in the New Economy Using
Orbian Credits
by Richard Page | SAPinsider
October 1, 2001
by Richard Page, SAP AG SAPinsider - 2001 (Volume 2), October (Issue 4)
Productivity, performance, and profit - three areas that every organization consistently tries to maximize. Historically,
organizations have used a range of initiatives including supply chain management and enterprise resource planning.
Now, they have turned to collaborative business processing.
With the emergence of the Internet, new opportunities have arisen to further maximize these objectives. One of
these opportunities is the electronic financing and payment of purchasing transactions between buyers and suppliers.
Global financial services company Citigroup, British research and development company DCE, and SAP came
together to form Orbian, a joint venture to launch a payment system for online business purchases. The Orbian
system delivers the ability to close the payment loop electronically. Closing the loop can improve organizational
productivity, increase performance, and increase profits.
In today's cash-based world, buyers and suppliers have conflicting interests when it comes to the costs of short-term
funding. Buyers want to defer payment as long as possible, while suppliers want settlement of receivables in cash as
soon as possible after shipping the goods and sending the invoice. Every day earlier that suppliers can get their
funds is one less day that they have to borrow from potentially costly sources. For buyers, every day that they can
defer payment preserves liquidity and reduces the need to borrow short-term working capital. The Orbian system
fulfills and reconciles the requirements of both the buyer and supplier.
Orbian achieved this by developing a unique new form of electronic payment obligation called an Orbian Credit.
Orbian Credits are liquid and highly flexible. They can be used to pay multiple suppliers who receive immediate, non-
recourse credit, and they can eliminate the lengthy settlement processes that currently slow down the speed and
efficiency of e-business transactions.
How Orbian Works
First, both buyers and suppliers must be Orbian members. A buyer orders goods or services from its supplier. The
supplier then triggers the settlement process. This trigger could be an electronic payment request over the Internet or

2. a marketplace - or even a traditional invoice. The buyer responds to this trigger by instructing Orbian to issue a
payment in the form of an Orbian Credit to its supplier, with an agreed-on maturity date that is later than the trading
partners' usual cash settlement date.
In issuing the Orbian Credit, a transfer of responsibilities occurs. The buyer has settled its obligation with the
supplier while simultaneously taking on an obligation to settle the cash payment to Orbian at the maturity date.
Through this process, the buyer has deferred the payment at a cost that is lower than traditional borrowing.
When the supplier receives the payment from Orbian in the form of an Orbian Credit, it is a promise by Orbian to
pay the supplier on the maturity date. The supplier can use this Orbian Credit in one of three ways:
• Use it to pay obligations to other suppliers by Orbian Credit
• Use it to discount all or part of the Orbian Credit into cash before its maturity date
• Wait and receive the full cash value of the Orbian Credit on its maturity date
Figure 1 takes you through each of these options. The supplier benefits by obtaining access to the value of its
invoices at a much earlier date and at a lower cost than traditional factoring or discounting. The service, the
infrastructure, the payment, and the trigger are all electronic, and they are all processed online or in real time.
Figure 1 Payment Process Using Orbian Credits
SAP has integrated the Orbian e-financing and payment process into the mySAP Financials solution and the SAP
Cash Management component. This brings with it significant advantages in terms of automatic payment processing.
Within the SAP system, users can designate open items for payment using Orbian Credits as the payment method,
and a payment run is then initiated (see Figure 2). This generates a file that is subsequently uploaded to Orbian. The
Orbian system processes the payment and posts it to the supplier's account.

3. Figure 2 Payment Process Using Orbian Credits
The daily Orbian statement is then downloaded to the SAP system, where the postings are executed in the same
way as a bank statement, and the open items are cleared.
The Benefits
A buyer can significantly reduce its working capital requirements by slightly pushing out payment terms to take
advantage of the reduced finance rates offered by Orbian. Alternatively, it could negotiate better product pricing. In
addition, buyers reap significant savings by streamlining accounts payable and automatic open item reconciliation,
combined with reduced bank fees.
The supplier benefits from knowing that payment is guaranteed on a specific date and that it can reduce the cost
of financing trade receivables by discounting the Orbian credit to cash at competitive rates, thereby offering the
supplier the ability to increase available liquidity to 100 percent of its receivables. Alternatively, the supplier can opt to
transfer Orbian Credits to pay other members of Orbian in its capacity as a buyer. Using Orbian Credits this way
enables non-rated or lower-rated suppliers to enjoy certainty of payment and to credit-enhance their payables.
Back-office costs can be reduced by automating processes: one payment can represent numerous invoices.
Suppliers can opt for automatic discounting to minimize their administrative burden and further accelerate the
collection cycle. Meanwhile, faster reconciliation is possible because payment details are known well in advance.
Technology and Security
The Orbian system is a custom-designed application based on the SAP system. It has been engineered for high-

4. value, fully distributed transaction processing on a 24x7 basis with seamless fail-over capabilities. The highest
security standards have been adhered to, and it exceeds the most stringent financial services security standards
currently available, utilizing smart card security, public/private key encryption, password protection coupled with
inactivity timeout, exit buttons, and lockout for failing to log-on after multiple missed attempts.
Secure business-to-business (B2B) integration between SAP systems and Orbian is provided with an XML-
standard interface for system-to-system connectivity for online and real-time processing of Orbian Credits.
Internet access is also available via a web-enabled browser that can support file transfers for batch processing.
Operational Implementation
The SAP interface with Orbian shown in Figure 2 has been incorporated into mySAP.com. Access is dependent upon
prior registration with a sponsor (a financial institution, bank, etc. that is registered with Orbian to provide sources of
credit). Implementation primarily involves the configuration of parameters and setting of default values, such as
Orbian-specific bank account details. Installation and activation of smart card readers is also required to gain access
to the Orbian system.
For more information or for details on becoming an Orbian member, visit www.orbian.com. For more information
on e-financing and settlement with mySAP Financials, visit www.sap.com/financials.
Richard Page has more than 20 years of experience in the financial
services sector. Since 1997 he has worked in corporate marketing for
SAP AG, with responsibility for global marketing of SAP Insurance
solutions and for the marketing of the SAP treasury offering. Richard
is currently the director of business development for general
business unit financials with special responsibility for Orbian. He
can be reached at richard.page@sap.com
Orbian Corp. is a U.S. company with offices in New York and London.
For more information on Orbian, visit www.orbian.com.