Although　upstream　manufacturers　with　small-　and　medium-sized　are　gradually　willing　to　invest　green　efforts　for　stimulating　market　demand,　they　have　been　encountering　the　challenge　of　securing　sufficient　working　capital　to　develop　the　green　supply　chain.　Thus,　this　paper　systematically　incorporates　two　types　of　prepayment　policies　including　risk-free　(RF)　and　risk-taking　(RT)　into　a　retailer＇s　dominated　channel.　Via　deriving　operational　and　financing　equilibrium　of　the　green　supply　chain,　a　series　of　interesting　findings　can　be　offered.　Specifically,　(1)　this　paper　identifies　a　threshold　value　regarding　the　manufacturer＇s　own　capital,　and　proposes　two　scenarios　for　assisting　the　retailer　to　decide　whether　offers　the　manufacturer　prepayment　policy.　(2)　The　effectiveness　of　RF　for　the　capital-constrained　manufacturer　depends　on　how　well　its　green　effort　can　be　implemented.　That　is,　provided　that　the　quality　effect　is　large　enough,　the　manufacturer　can　get　more　upfront　capital　from　the　retailer,　which　may　entirely　cover　its　total　production　and　green　effort　costs.　(3)　Under　RT,　if　the　manufacturer＇s　capital　is　relatively　lower,　RT　enables　the　manufacturer　to　obtain　sufficient　capital　and　the　retailer　is　willing　to　share　partial　of　the　manufacturer＇s　default　risk.　Otherwise,　RT　may　not　be　the　best　prepayment　policy　for　the　retailer.