Top Lessons from Invoice Financing Bankruptcies 2025: What You Need to Know

May 28, 2025

The invoice financing industry has witnessed remarkable growth, reaching a global market size of $4.5 trillion USD as of May 2025, according to recent industry estimates. This growth underscores the critical role platforms like Incomlend play in bridging liquidity gaps for exporters and importers, particularly small and medium-sized enterprises (SMEs).

However, the past decade has also exposed vulnerabilities through high-profile bankruptcies and scandals that have shaken the trade finance ecosystem. From Greensill Capital to Hin Leong Trading, these cases offer vital lessons for businesses seeking funding and investors supporting invoice financing platforms.

In this article, we delve into these incidents, analyze their causes, and outline key takeaways to help you navigate this dynamic landscape. At the end, we’ll share Incomlend’s proven approach to mitigating such risks, ensuring stability for all stakeholders.

Greensill Capital: A Cautionary Tale of Overreach

Greensill Capital, a UK-based supply chain finance firm, was a fintech darling by 2020, managing $143 billion in assets under management (AUM). Founded by Lex Greensill, the platform grew rapidly by offering innovative financing, including future receivables loans (FRLs), and attracted giants like Credit Suisse and SoftBank. However, its collapse in March 2021 revealed deep flaws. The firm’s reliance on speculative FRLs—financing projected cash flows rather than confirmed invoices—led to $4 billion in uncollectible loans. When Credit Suisse withdrew insurance, a liquidity crisis ensued, resulting in $5.4 billion in creditor losses and 1,000 job cuts. Investigations uncovered fraud tied to Gupta Family Group, alongside regulatory non-compliance with the UK’s Financial Conduct Authority (FCA).

Lesson: Overly aggressive lending models and unchecked growth can lead to disaster. Businesses must validate receivables rigorously, and investors should monitor rapid scaling for signs of instability.

Stenn Technologies: The Perils of Opaque Operations

Stenn Technologies, a London-based fintech launched in 2015, facilitated $10 billion in invoice financing across 70 countries, reaching a $900 million valuation with backing from HSBC and Barclays. It targeted SMEs in global trade but entered administration in December 2024 after HSBC flagged irregularities. Alleged ties to a Russian money laundering scheme resulted in a £100 million shortfall to creditors by February 2025, costing most of its 200 jobs. The lack of transparency in its operations and governance failures under founder Greg Karpovsky eroded trust, marking one of the largest fintech failures since Greensill.

Lesson
Transparency and governance are non-negotiable. Businesses should ensure operational clarity, while investors must demand regular audits to detect potential fraud early.

Marco Polo Network: When Innovation Isn’t Enough

Marco Polo Network, launched in 2017 by R3 and TradeIX, aimed to revolutionize trade finance using blockchain technology. Backed by over 30 banks, including ING and Standard Chartered, it raised $15 million and promised streamlined processes. However, by February 2023, it entered insolvency with €5.2 million in debt. Despite its technological promise, Marco Polo struggled with low adoption and failed to achieve a viable business model. The rapid scaling of an untested solution in a cost-sensitive market led to its downfall, highlighting the gap between innovation and market fit.

Lesson
Innovation must be paired with proven demand. Businesses should validate market needs before scaling, and investors should assess a platform’s viability beyond its technological allure.

IIG Global Trade Finance Fund: Fraud at the Core

IIG Global Trade Finance Fund, a New York-based fund, managed $500 million in assets by 2018, offering high-yield trade finance loans to institutional investors. In 2019, the SEC charged IIG with fraud, revealing $60 million in fake loan assets and $37 million in investor losses. By November 2024, legal proceedings confirmed the fund’s collapse, driven by forged documents and intentional misrepresentation of returns. The fraud was systemic, starting early to inflate performance and hide losses, exposing a lack of internal controls and oversight.

Lesson
Fraud can undermine even seemingly stable platforms. Businesses need strict internal controls, and investors must verify asset authenticity through independent audits.

Hin Leong Trading: The Cost of Hidden Risks

Hin Leong Trading, a Singapore-based oil trading giant, was a key player in Asia-Pacific trade finance, with $3.8 billion in liabilities by 2020. It expanded rapidly in the 2010s, leveraging trade finance from banks like HSBC and OCBC. In April 2020, it filed for bankruptcy after a $800 million loss from oil price collapses and revealed $2.5 billion in hidden debts. Founder Lim Oon Kuin faced fraud charges for falsifying accounts to mask mounting losses, exacerbated by inadequate risk management against market volatility. The collapse disrupted global supply chains, highlighting systemic vulnerabilities in trade finance.

Lesson
Market risks must be hedged, and financial transparency is critical. Businesses should maintain accurate records, and investors need to monitor financial health closely.

Key Lessons for Businesses and Investors

For Businesses Seeking Funding

• Validate Receivables Rigorously: Greensill’s speculative FRLs and IIG’s fake loans underscore the need for verified receivables. Ensure invoices reflect real transactions to avoid liquidity traps.
• Scale Prudently: Rapid growth without controls led to collapses like Greensill, Stenn, and Marco Polo. Expand operations only with robust oversight in place.
• Maintain Transparency: Hin Leong’s hidden debts and Stenn’s opaque practices eroded trust. Keep financial records clear and accessible to partners.
• Diversify Funding Sources: Over-reliance on single partners (Greensill’s insurers, Stenn’s banks) can be fatal. Secure multiple funding lines to mitigate risks.

 

For Investors Funding Invoices or Equity

• Conduct Deep Due Diligence: IIG’s fraud and Greensill’s unverified blank check loans highlight the need to verify assets and models through independent audits.
• Diversify Investments: Concentration in Greensill ($5.4 billion loss) and Stenn (£100 million) caused significant losses. Spread capital across platforms and regions.
• Monitor Governance Closely: Leadership failures in Stenn and IIG show the importance of assessing integrity and demanding regular updates.
• Assess Market Fit and Liquidity: Marco Polo’s low adoption and Hin Leong’s market shock reveal the need to evaluate demand and financial resilience.

 

The Incomlend Perspective: Preventing Adverse Situations

At Incomlend, we’ve built our platform on the principle of stability, drawing on these lessons to protect our clients and investors. Here’s how we ensure resilience:

• Prudent Volume Scaling: We grow cautiously, prioritizing operational stability over rapid expansion, avoiding the pitfalls of Greensill and Marco Polo.
• Conservative Risk Management: Our risk framework minimizes exposure to speculative financing, focusing on verified transactions, unlike Greensill’s FRLs.
• Multiple Source Verification: We finance only post-shipping, requiring supplier invoice confirmation by buyers and cross-checking trade documentation like Bills of Lading (BLs), ensuring transaction authenticity and avoiding IIG-style fraud.
• Diversification of Buyer-Supplier Base: By diversifying our client base, we reduce dependency on single parties, mitigating risks seen in Stenn and Hin Leong.
• Bankruptcy-Remote Legal Structure: Our legal structure protects investor funds, ensuring they’re safeguarded even in adverse scenarios.
• Credit Insurance: We use credit insurance to shield against credit risk, adding a layer of protection for investors.
• Full Payment Flow Redirection: Payments flow through Incomlend’s trust accounts, ensuring transparency and control, preventing misuse seen in Hin Leong.

 

Conclusion: A Path Forward

The invoice financing industry, valued at $4.5 trillion USD in 2025, offers immense potential but also significant risks, as seen in the collapses of Greensill, Stenn, Marco Polo, IIG, and Hin Leong. These cases highlight the dangers of unchecked growth, opaque operations, fraud, and market misjudgments. For businesses, the focus must be on rigorous validation, prudent scaling, and transparency. For investors, due diligence, diversification, and governance scrutiny are non-negotiable.

At Incomlend, we’re committed to leading with integrity, using conservative practices and robust safeguards to protect our ecosystem. By learning from the past, we’re building a future where invoice financing is a reliable, resilient solution for global trade. Join us in navigating this landscape with confidence—reach out today to explore how Incomlend can support your trade finance needs.