Standard Chartered Bank Korea said Thursday it signed an environmental, social and governance-related supply chain financing deal worth a combined $180 million with local electric-vehicle battery material suppliers.

The lender’s new partnership with Posco Chemical and L&F will provide the EV battery material suppliers with financing in the form of trade receivable discounting.

Trade receivable discounting or TRD is a type of factoring in which a supplier provides its products to the buyer and assigns the accounts receivables to a bank, and the bank makes payments to the seller in advance and receives payments from the buyer at a later date. Generally, it takes up to several months for a seller to get paid for its invoice after supplying goods. If a seller signs a TRD agreement with a bank, it can shorten the payment period and allows the seller to receive payments early and increase sales efficiency.

The partnership will allow the EV battery material suppliers to provide a sustainable supply of cathodes for EV battery manufacturers.

SC Bank Korea’s parent firm, Standard Chartered Group, categorize the TRD facility deals as environmentally friendly transactions producing renewable energy at the end-use stage and certifies them as sustainable finance, the firm said.

The deal with L&F and Posco is each worth $100 million and $80 million.

“ESG management and a transition to net zero are mandatory for all corporates including SC Bank Korea,” SC Bank Korea CEO Park Jong-bok said in a statement.

“We will develop a wide range of financial solutions to help remove the financial barrier preventing a transition to net zero by increasing green finance and ensuring clients can transition to a more environmentally friendly industry.”