The future of supply chain finance platforms
14 January 2010
Corporations are asking for more and more capital allocation. The numbers easily reach the Billion Euro/ Dollar sphere, and no single bank has the appetite to take on such a risk alone. The likely future model is one of a syndicated marketplace based on a technology platform, into which financial institutions, private capital funding, insurers, and logistic service providers will plug to provide collaborative supply chain finance services. We foresee a number of such platforms to appear in the next 2 to 3 years, branded by very large banks. Such banks will play the leading role (e.g., decide services, pricing, risk appetite), representing the main reference point to smaller FIs. Bottom line for banks Those who want to play the game must decide, today, which experienced solution providers to partner with. It's most unlikely this game can be played alone (i.e., build and run the platform). Bottom line for corporations The perspective of a "one-stop" shop for open accounting and trade-related services is taking shape. Instead of passively "sit and wait", we recommend decision makers to proactively check the plans of their major reference banks and establish programs to influence the results at their benefit. SEPA has shown that corporations must take an active role in, apparently, bank-only related matters. *** This post was mentioned as one of the favorite banking technology-related blog posts in Bank Systems & Technology's Honor Roll: This Week's Top Banking Blogs (Jan. 10-16). ***
Comments
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My thought is "There is a growing corporate demand for financially efficient supply chains, with companies and their suppliers under conflicting pressures to improve payment terms, reduce prices and improve cash flow efficiencies.Supply chain finance (a form of asset based lending and reverse factoring) solutions aim to improve the financial efficiency of the supply chain, resulting in both suppliers and buyers enjoying a substantial reduction in working capital through the supplier finance/vendor finance programme"
This article was mentioned as one of the favorite banking technology-related blog posts in Bank Systems & Technology's Honor Roll: This Week's Top Banking Blogs (Jan. 10-16).
Read at http://www.banktech.com/blog/archives/2010/01/honor_roll_this_15.html