Emerging Transaction Banking Opportunities in Supply Chain Finance

To tap new markets or reduce costs, large corporations are expanding geographically or shifting to new locations. In the process, they try to integrate their physical and financial supply chains, optimising working capital each step of the commercial cycle.

For banks, this presents new opportunities in supply chain finance, which provides both sellers and buyers with short-term credit for working capital purposes. Moving forward, 45% of revenue for banks in transaction banking will come from supply chain finance.

 But tapping opportunities in supply chain finance is no walk in the park. To start with, banks aren’t traditionally strong players in supply chain finance. So how do banks develop the capability to offer supply chain finance services? What organisational and business process changes are needed? What technology is required to develop platforms that can facilitate supply chain financing? What do clients with integrated supply chains expect from their banks?

 These and other issues were discussed at a recent executive briefing co-organised by FinanceAsia and Misys. Held in April in Taipei, the event was attended by senior representatives from leading banks and large corporations.

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