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One of the largest financial services groups in Europe has partnered with HPD Software, a global working capital finance solutions company, to further...

Commercial, technical and legal integration are intrinsic parts to every supply chain. There is no successful supply chain finance programme that doesn’t integrate these three. Just launching a programme that is distributing liquidity to your suppliers doesn’t mean it’s successful. A successful programme is one that helps the clients and suppliers to reduce the risk whilst accessing liquidity in a commercially and legally efficient solution. We do not think Supply Chain Finance is evolving on this respect, but it is maturing. The market is maturing.

No, it hasn’t gone away, fraud is still there. The process and structure put in place to access liquidity requires certain information like an invoice, so there is the opportunity for somebody who is either a criminal fraudster or, sometimes, sadly, legitimate businesses who have come into difficult cash flow situations and then started to abuse the system by introducing false invoices. For instance: let’s say that the business from ‘buyer X’ is expected next month so it doesn’t take much to change the date on the invoice from the 1st of April to the 1st of March. Its advancing forward in time an invoice but it no longer matches reality and is a “timing” fraud. The business has not transacted so it’s fraudulent because you’re asking for money on the base of an invoice which does not exist because goods have not actually shipped. It’s commonly a first toe-dipping exercise into the world of fraud.

Sancus Finance has announced that it will be strengthening the organisational structure of the company by appointing a new member to its company board...

Receivables finance is a business that has evolved in a significant way over the last years. It has gone from a traditional model, in which the risk was mostly based on the commercial contracts supporting the transaction (bill of lading, letter of credit, etc.), moving to receivables finance in open account basis, in which risk has to be analysed for each of the counterparties. In the last years, the use of insurance to cover the underlying risk has become very usual in the market, increasing the capabilities of the banks. These evolutions explain in part the double-digit growth seen in the last 10 years in this business. However, we still see a lot of room for development in this field.

These political events are going to make free trade and global supply chains more difficult to manage, but they will not be strong enough to reverse the trend of globalisation - especially considering we also have a lot of technology developments that make this thesis irrelevant. Supply chains will remain global, the need to finance them will remain, but it will probably become more complicated. The task and opportunity for the banks is to improve the way they understand the localities and, on the other side, how good they are at connecting all the dots and making sure that supply chains function and that the financing of the supply chain keeps functioning, even if they are now more physical and economical across states.

4Syte Funding, an invoice finance provider, has agreed a Ј4million finance facility with specialist lender and...

I would say certainly that globalisation, although there are some threats to it, is still here and Asian suppliers need much more cash then European or North American suppliers would. These are very small companies and even if they have access to bank finance it is very expensive. So really, in this case, the arbitrage between the interest rates that European or North American companies would pay versus the SMEs in Asia is certainly beneficial to Asian companies. So supply chain finance is certainly, in this case, used at its extreme meaning – really playing on interest rates to facilitate the pre-shipment finance which is so important for these SMEs in Asia.

Yes, it is alive. The potential is there and the business is growing, slowly but steadily. In the last year we have seen a growing interest in our corporates for the BPO, on the import and export side. The biggest hurdles we experience are banks that have not invested in the BPO yet or are not BPO ready. We try to support them and get them ready and we are happy to share our experience. Banks might hesitate due to investment reasons, lack of knowledge regarding the business potential or problems to create a business case. I see growing potential for the BPO, steady increase of BPO business and hope that the BPO reaches the tipping point in the near future.

Yes, absolutely. This is a tendency that we cannot afford in a country with volumes of trade at stake. This can also contaminate other countries with a reaction of whether they should do the same thing, then it will be global and we do not even know the size it will become. The entire world has been working in recent years for an open global market and now we are going in the opposite direction.