China is to permit foreign companies to access its $27 trillion payments market. Foreign players can start applying for payment licenses and will be treated the same as local firms, the People’s Bank of China announced yesterday. Those entering the market must set up a local presence, have the requisite payment infrastructure and host their client information domestically.
Nucleus Software, an India-based company providing financial institutions with lending and transaction banking technologies, has added a trade finance portal to its offering and updated its existing transaction banking tool, FinnAxia 5.0.
The cost of rising protectionism is a concern for businesses but they are optimistic about their international business prospects, according to a new report from HSBC called "Navigator: Now, next and how for business".
Companies are looking to regional partners to develop trade opportunities, with 74% of overseas trade in Europe and Asia-Pacific being conducted within their 'home' region.
Of the 6,000 firms surveyed globally, 61% think governments are becoming more protective of their domestic economies. This sentiment is strongest among companies in MENA (70%), and Asia-Pacific (68%). In the US, 61% believe protectionism is on the rise, while in Europe (50%) are seeing a rise in protectionist tendencies.
George Shapiro, CEO and chairman of The Interface Financial Group, talks about how the lending and invoice finance markets have changed over time, how suppliers are accessing capital today, and how procurement’s increased awareness of early payment options is changing the invoice financing game for companies large and small.
Trade credit insurer Atradius saw its profit fall more than 12% last year compared to 2016. Total revenues were €1.8 billion, up 4.3%. The group predicted "a year of stable growth in 2018 with insolvencies, on average, stable".
The Financial Stability Board has released a report on correspondent banking relationships, finding that the reduction in the total number of active correspondents - measured by the number of banks that have sent or received messages continued in the first half of 2017.
The decline is a concern because in impacted jurisdictions it may affect the ability to send and receive international payments or drive payments underground, with potential adverse impacts for trade, growth, financial inclusion, financial stability and the integrity of the financial system.
Islamic trade finance needs to be developed with instruments that allow better control of risks related to trade partners or countries - and credit risk could also be shared with another party through various types of trade instruments, ranging from risk participation with a bank to using export credit agencies or multilateral credit agencies to provide credit risk mitigation.
Islamic trade finance could then become the preferred choice for emerging markets such as Turkey, Indonesia, Malaysia, Qatar, Saudi Arabia and the UAE.
Japan Post Bank has expanded its relationship with Earthport to deliver outbound cross-border payment services across a number of additional regions including North America and Europe. Earthport says it has a payment network of over 67 countries.
Fintechs and non-bank financial service providers are set to take over traditional banks as the preferred choice for small and medium-sized enterprises in Australia, new research by Scottish Pacific shows.
The number of SMEs which said they would use banks for funding dropped to 24% this year from 38% in 2014, while 22% said non-bank lenders were their top funding choice this year - up from 11% in 2014.
Eximchain, a blockchain-based platform developed in the Massachusetts Institute of Technology's media lab, has raised $20 million for its supply chain financing solution. The group, which uses blockchain to facilitate supply chain financing via smart contracts and a token system, is readying for its token airdrop, which aims to provide 1.5 million EXC tokens that can be converted to native tokens on the company's blockchain when it launches.
Emerging markets-focused payments technology company DLocal is now enabling acceptance and disbursement of payments in Morocco and Egypt, building on last year's expansion into Turkey and India.
The group has also added payments veteran Marcelo Perez as CFO. He has over 25 years of experience as an international finance and strategy executive and has held senior positions in finance, risk, and corporate development at Visa, GE Capital, Citibank, Cielo and Transfast.
Hong Kong-based online invoice financing service provider Qupital has formed a partnership with global trade marketplace group Alibaba.com to strengthen its invoice financing platform to facilitate trade for small and medium-sized enterprises. Alibaba.com Gold Supplier members applying for Qupital's invoice financing service can now opt to have their applications fast-tracked by using their operations record with Alibaba.com as an evaluation factor.
UK regulators are calling for an inquiry into whether the market's Big Four accountancy firms - KPMG, Deloitte, PwC and EY - should be broken up and forced to spin off their auditing arms.
The Financial Reporting Council's Chief Executive Stephen Haddrill wants an investigation into whether such a breakup would enhance competition and reduce conflicts of interest.
A previous inquiry by the then-UK Competition Commission - now the Competition and Markets Authority - introduced stricter rules for the accountancy market, but Haddrill said the measures have done little to boost competition.
Spendmatters.com looks at Payment Services Directive - a new EU directive that enables a bank's customers, both consumers and businesses, to use third-party providers to manage their finances - and how the bank-fintech world develops B2B Lending.
Following the Punjab National Bank fraud, the Indian industry is calling for the adoption of hi-tech control systems to check financial frauds - and blockchain technology is being touted as a promising solution. Several banks under State Bank of India have formed a consortium and launched BankChain to explore blockchain tech in banking and financial transactions but However the PNB fraud has given more impetus for blockchain proponents.
American Express has filed a patent related to faster payments and blockchain technology. The filing describes a blockchain solution to receive requests for payment, which would then be approved or rejected, a process that would include risk analysis. The platform, if approved, would automate processing and adjust accounts on both ends of the transaction. The solution would require both payer and payee to create a blockchain-based digital wallet, enabling payments to occur on the blockchain platform itself rather than via a third-party institution.
Three major banks in Indonesia - Bank Negara Indonesia, Bank Rakyat Indonesia and Bank Sinarmas - have signed up to SWIFT's global payments innovation initiative, SWIFT gpi. Indonesia, the largest economy of the ASEAN region, joins other large economies such as Thailand and Singapore that are already live on the service.
Belgium-based market infrastructure firm Isabel Group has taken over from TrustHive the initiative to build a blockchain platform to simplify the 'know your customer (KYC)' process for corporates. Norbloc, a Swedish start-up that builds regulatory applications on blockchain platforms, was selected as a technology partner for the pilot phase.
Chicago-based alternative investment firm Victory Park Capital (VPC) and the International Finance Corporation have launched a new fund that will invest in fintech companies in the developing world. VPC has been involved in over 45 transactions in the financial-services sector but the new partnership will open the firm up to developing markets for the first time. The fund will invest in up to four transactions per year.
Euler Hermes has unveiled its Enabling Digitalization Index 2018, highlighting each country's ability to help businesses to succeed in a digitalised global economy. Western Europe stands out, with 16 countries ranked in the top 30. Four countries made it to the top 5: Germany, Netherlands, Switzerland and the UK.
In Latin America, weak connectivity, logistics infrastructure and innovation scores are the main shortcomings. Chile (43rd) and Mexico (52nd) are the highest ranking countries in the index.
The Asia Pacific region performs well, with eight countries - Japan, Singapore, Hong Kong, South Korea, China, Australia, New Zealand and Malaysia in the top 30.
US-based SME financing firm BlueVine has teamed up with cross-border payments specialist Veemto to enable small business owners to save on international payments. BlueVine offers small businesses financing options including an invoice factoring line of credit and a traditional business line of credit.
BFC Bank has launched in the UK to service the country's small and medium-sized enterprises. The lender, a subsidiary of the Bahrain Financing Company, says its core services are international payments, multi-currency accounts and foreign exchange. It also aims to boost access to banking services for payments service providers, claiming de-risking by major global banks has left many without proper GBP accounts to serve their clients.
Pay-outs made by trade credit insurers reached £225 million last year - a 7% rise on 2016 and the highest since 2009, according to new figures by the Association of British Insurers. There were 11,017 claims in 2017 - equivalent to 212 companies being helped every week. And the level of trade covered by trade credit insurance in the UK stands at a record £340 billion, up 7% on 2016.
Last year saw high profile company failures such as Monarch Airlines, Palmer and Harvey and Misco, followed by Carillion, Toys R Us and Maplin in 2018.
India's Yes Bank has launched a new robotics-based 'Digital Export and Import' Payments solution. The technology - which it claims is the first of its kind to be used in the Indian market - uses robotics process automation instead of documents for import and export payments.
The bank plans to offer the solution to select corporates in India to start with, and is expected to bring down turnaround time of payments by 80%.
Australia-headquartered foreign currency exchange group OFX has launched a developer portal, designed to provide the global developer community with easy access to the company's new Payments API. Marketplaces, service platforms and small and medium-sized enterprises can now automate all international payments directly through their own platform, it says.
US-headquartered global trade fintech Haven has added two new features: automated bill of lading and automated invoice auditing in a bid to streamline customers' freight payments and documentation workflows. When customers process shipments within Haven TMS, the technology audits shipment-related documents to ensure that Bills of Lading and freight invoices are correct, it claims.
Barclays Bank of Kenya has launched an Islamic trade financing product featuring Shariah law compliant trade facilities. The La Riba trade finance is a short-term facility to cover buyers and sellers during trade cycle funding gaps for both local and international trade transactions.
Tradeteq, a cloud-based platform which matches trade finance originators with investors, has been launched by former investment bankers Christoph Gugelmann and Nils Behling. Following the London-based group's soft launch last year, $130 million of assets have already been processed.
The founders initially worked together in FICC distribution at Bank of America Merrill Lynch. They then joined Trafigura's asset management arm, Galena, sourcing, arranging, and funding transactions for trade and other assets.
The factoring industry is once again showing positive signs, with many markets reporting significant growth, according to FCI. The total volume estimated for 2017 amounts to €2,472 billion, which represents a growth of 4% over 2016 where it reached €2,376 billion.
European markets showed a 7% rise - but the figures collected are expressed in euro and some markets involved, such as the UK and Turkey - which account for a substantial part of European volume - are suffering high volatility in their currency.
Volumes in South America grew by 9% thanks to Brazil, which increased over 11% and Argentina at 21%. Asia declined once again by -4%, influenced by the decline in China and by the results of other traditional strong players such as Japan (-25%).
The Eastern Caribbean Central Bank (ECCB) and Barbados-based fintech group Bitt are planning to conduct a fintech pilot using blockchain technologies in the ECCB eight member countries. They will develop, deploy and test technology for data management, compliance and transaction monitoring for know your customer (KYC), anti-money laundering (AML) and combatting the financing of terrorism.
India's nascent fintech sector has huge potential but needs a supportive regulatory environment and investment in human talent to flourish, a new report commissioned by Yes Bank suggests. To help the sector grow, 88% of startups say that they want a government-funded co-working and joint research zone, while 87% want a regulatory sandbox. Meanwhile, 85% want a fintech registry to develop better sector understanding and accelerate proof-of-concept funding.
US-headquartered alternative SME lending company Fundbox has launched Fundbox Pay, a solution the company says will move its credit offering closer to the B2B transaction itself. It claims the solution will let suppliers request payment on an invoice presented to a small business customer, and invite them to use credit via Fundbox to pay it.
Wyelands Capital, a member of the GFG Alliance, has entered into a strategic partnership with working capital solutions fintech group Demica to provide inventory finance to global commodity producers and traders. Wyelands Capital also acquired an equity stake in Demica as part of the partnership.
Wyelands has also bought London-based global insurance solutions provider Trans-World Credit Corporation. It will be the lead broker for trade credit risk insurance for members of the GFG Alliance globally.
As part of the growth, Wyelands has hired Simon Grenfell, formerly of Macquarie, Morgan Stanley, Goldman Sachs and most recently as global head of commodities at Natixis, as head of financial restructuring and a non-executive director of Wyelands Bank.
Simon Nasta, formerly of Allen & Overy and the Bank of London and The Middle East plc, also joins as Group General Counsel. His most recent role was as General Counsel of First Bank of Nigeria.
Blockchain technology could have the potential to address late and delayed supplier payments, according to a new report by the Korea Small Business Institute. Smart contracts in particular may be able to relieve small suppliers of the wait for invoice payments.
Blockchain would allow for cryptocurrency payments of an invoice to be negotiated at the time of purchase, and included in a contract. That means a large corporate buyer would not be able to withhold payment on an invoice even if it wanted to. The most glaring problem is getting corporate buyers to actually agree to these terms.
China and Japan are becoming competitors for trade and investment in the Asia Pacific region, according to a new report by Coface. Japan holds its advance in terms of investments but China remains on top in trade. But growing Chinese investments could eventually pose a threat to Japanese corporate interest in the region, it claimed.
Some players say electronic invoicing and electronic payments can help accelerate B2B invoice payments. The alternative finance market argues that solutions like invoice financing and factoring are fitting. Others say that government regulation is necessary. But Richard Garnier, from trade credit insurer Euler Hermes, said these approaches fall short. "I don't think technology is really the solution," he said. "This is about habit - and it may take a generation to change."
Finastra has been selected by the Joint Stock Commercial Bank for Foreign Trade of Vietnam (Vietcombank) to drive the lender's digital transformation initiatives. Its Fusion Trade Innovation offers an automated and centralised trade finance solution to remove complex banking processes.
Germany-headquartered trade finance group DS-Concept has opened an office in the Peru capital of Lima with the goal of financing foreign trade for companies in the region. DS-Concept Peru will focus on financing medium-sized companies.
UK-based alternative lending platform Funding Circle has reportedly chosen the banks to help it go public. Bank of America Merrill Lynch, Goldman Sachs, Morgan Stanley and Numis Corp will reportedly help the group, which facilitates loans for small business borrowers across the US, UK, Germany and the Netherlands, in its initial public offering in the UK.
It could be the largest IPO by a UK fintech, with sources noting the company’s valuation could be as high as $2.77 billion.
A 'no-deal Brexit' could leave companies in Britain and the EU facing an extra £58 billion in annual costs - with the financial sector set to be the worst-hit industry, according to a new report by Oliver Wyman management consultants and law firm Clifford Chance.
Firms across the EU’s 27 countries other than Britain will have to pay £31 billion a year in tariff and non-tariff barriers if Britain leaves the bloc without a deal. British exporters to the EU will in return have to pay £27 billion a year, the report states.
First Abu Dhabi Bank has selected Accuity, a provider of risk and compliance, payments and know your customer solutions, to provide integrated global sanctions screening and data. The lender hopes to boost its transaction, customer and third-party screening processes.
XL Catlin is to become a founding member of InsurTech Asia Association. Membership will offer XL Catlin a single point of access to the Insurtech ecosystem in Asia, including regulators, investors, customers, talents and partners.
When it comes to supply chain finance, the supplier onboarding process for bank originated SCF programs is worse than a root canal. Why? We are dealing with banks that have strict internal compliance controls because they are scared of fines. Obviously there is a balance between risk controls around money laundering and terrorist financing and giving more suppliers access to supply chain finance from investment grade companies.
FinTech Australia is on the hunt for a new CEO as Danielle Szetho has resigned less than two years into the job. Sarah Worboys has been appointed as interim CEO. Until recently, she was the head of strategy and operations at Timelio, a Melbourne-based P2P invoice financier.
The Reserve Bank of India has initiated a special audit of state-owned lenders with focus on trade financing activities, especially relating to issuance of letters of undertaking (LoUs) by them, amid a spate of banking frauds, including at Punjab National Bank. RBI has asked all banks for details of the LoUs they had issued, including the amounts outstanding, and whether the banks had pre-approved credit limits or kept enough cash on margin before issuing the guarantees.
The European Banking Authority may have created a "roadmap" on how to regulate emerging finrech service but the body is not keen on creating a unified approach to cryptocurrency regulation - at least not yet. As new European Union rules are making it easier for startups to roll out services, such as payments, European Banking Authority Head Andrea Enria said his organization would look into the services provided by fintech firms, "with a view to ensuring that similar services, entailing comparable risks, are regulated in a consistent way across the EU", he said.
BBVA, Visa, Lakestar and ABN Amro have contributed to a €56.6 million funding round for German banking-as-a-service platform solarisBank. The four new investors joined existing backers Arvato Financial Solutions and Japanese SBI Group in the latest round, which will be used in the development of new products for its corporate clients and for international expansion.
TXF is back in DC! We'll be examining how multilaterals are evolving to fulfil an expanded remit, while maintaining a focus on emerging and frontier market development and infrastructure. Join corporates and leading practitioners in agency finance to debate industry challenges.
To kick off TXF Global 2018, we'll be bringing together senior developers, government personnel and investors to focus on project finance deals. Our dedicated Project Finance Day is a must for all infrastructure pro's!
The party of the year is back for 2018! TXF Global brings you all things Export & Agency Finance to the colourful city of Prague. Described as the fairy-tale city, TXF Global is here to make all your export finance dreams come true...