Supplier Onboarding – It’s all about the Front, Middle and Back office Part II

- January 29, 2015 4:59 AM | Categories:

onboarding-by-Pablo-Verdugo-flickr In this short series, TFM continues to look at the onboarding process with a look at the Front Office. Selling money can be hard work. Early pay techniques selling money attached to some eProcurement or eInvoicing or Network platform have proliferated but cannot operate a build it and they will come mentality. In particular what the market likes to call Reverse Factoring or Supply Chain Finance, which sells Libor plus based finance, is no slam dunk. I had one Vice President in charge of , Working Capital Finance at a large conglomerate tell me. From my perspective what it takes […]

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Stress Testing Ones own Marketplace Loan Book

- January 28, 2015 3:50 AM | Categories:

Vice-grip-squeezing-a-purse-thumb5676293 There is a lot of noise around marketplace (formerly known as Peer to peer lending). It’s been almost a decade since the first UK P2P Lender Zopa launched, back in April 2005. Investors are hungry for these loans. Many institutional funds such as Blue Elephant Capital Management are raising capital to invest in marketplace loans. But what about understanding loss rates as economic fundamentals change. These are turbulent times. This is where stress tests come into play. Stress tests were made famous by the Federal Reserve to basically become the de facto capital standard to ensure banks could withstand various […]

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The Rise (and Rise) of Supplier Networks: The Comet Coming?

Trade Financing Matters - Free White Paper Download
The world of trade finance has traditionally been served by the documentary letter of credit for hundreds of years. The associated management of risk and financing services has hitherto been the exclusive domain of the financial services industry, comprising both banks and to some extent specialist non-bank financial institutions. As we enter 2015, it is increasingly clear that as in other areas of financial services, the business of trade finance is exposed to the competitive threat of non-traditional service providers, including those in the financial technology sector who are well positioned to take advantage of new supply chain logistics and other trade-related platforms through the provision of new products and services underpinned by new business models. Find out what the future has in store with this free, new downloadable piece of research from Trade Financing Matters.

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Supplier Onboarding – Dont shortshift Execution Part I

- January 27, 2015 2:47 AM | Categories:

onboarding-by-Pablo-Verdugo-flickr Trade Financing Matters will examine Supplier Onboarding in a series of four posts. The term supplier onboarding, like the term “supply chain finance” means different things to different people. For some, onboarding basically means get as many suppliers to accept my (einvocing, supply chain finance, dynamic discounting, pcard, etc.) program as possible. For others, it’s an elaborate process to manage “know your customer” by doing the necessary things to comply with regulations about opening accounts for new customers. For others, it can mean the analytics that are used to analyze and segment suppliers for a particular program. I would in […]

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Powerpoint’s Disservice to FinTech

- January 26, 2015 6:41 AM | Categories:

Microsoft-Powerpoint-Viewer I wrote a post about a year ago about Microsoft Powerpoint, or more precisely, how Powerpoint slides paint a vision for vendor which is accepted as reality. Truth be told, we are living in very confusing times. And there are opportunities to be made out of a messy world. But too many times I have seen visions that are dumbed down by slides and accepted as reality. My previous post stated, I see a lot of press releases and receive a lot of next big things in my inbox on the future of trade.  Much of it comes in the […]

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Gleaning through Tungsten’s Interim Financial Report

- January 22, 2015 3:37 AM | Categories: ,

imgres My colleague Peter Smith covered Tungsten’s financial result earlier this week-  see Tungsten’s Half-Year Results: Short-Term Disappointment, but Long-Term Promise Okay Tungsten is losing money. But so are Lending Club, OnDeck, and many others that are trying to change the way finance is done, in Tungsten’s case, transactional business invoice financing. I read through their interim report the other day, and a couple themes stuck out beyond the financials: Potential Market Size is huge With Tungsten’s current network, if all buyers were enabled to provide Tungsten Early Payment to suppliers for invoices shown as “approved to pay”, the annual value […]

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Why APIs matter in Fintech

- January 21, 2015 4:09 AM | Categories: ,

freeimages.co.uk techonology images It’s getting harder to turn around in finance, especially fintech, without bumping into some reference to APIs, or application programming interfaces. Why do we normal folks have to worry about APIs? Aren’t they for the tech guys? APIs basically lay out the rules for how one application can talk to another. As Susan Joseph pointed out on her post around Marketplace Lending, the API is critical because it communicates information about the loans. Marketplace lending is unique because it offers its’ investors a deep dive into important data. This means, in practical terms, you have a lot of good information […]

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Quantifying the Size of Shadow Bank Assets

- January 20, 2015 4:55 AM | Categories:

shadowbanking_2414190a The Financial Stability Board (FSB) recently released their report on the Global Shadow Banking market and has come up with a figure of $75 trillion for the market. That’s right, trillion. These are financial assets help by money fund, hedge funds, broker dealers, essentially anyone other than what is defined as a bank. I’ve done some prior posts on this market here and here I commented that the market lacks data and the real question is risk being pushed to where it cannot be seen? The reason this is considered “shadow” (doesn’t that term really scare people) is that these […]

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Is the Consumer Financial Protection Bureau ready to Rock Marketplace Lenders World?

- January 19, 2015 5:49 AM | Categories:

Trade Financing Matters welcomes this guest post from Susan Joseph, a former General Counsel of a start-up peer lending financial services/tech disrupter. The Consumer Financial Protection Bureau (CFPB) was created by the Dodd-Frank Act and is a US government agency whose mandate is to protect consumers of financial services and products. This means there are strong federal rules that protect consumers. It also means there is federal enforcement if you break those rules, and that enforcement can result in injunctions that shut your business or fines and penalties. The CFPB has a broad reach and can specifically make rules effecting […]

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The Confusion Around Fintech Lists

- January 15, 2015 2:02 AM | Categories: ,

images I see this mega basket called Fintech and it’s the word of the year besides disruption (but both are generally used in the same sentence). I remember not too long ago it was Asset Bubbles. I guess the whole world of Internet finance 1.0 has transitioned into fintech 2.0. Fintech seems to span everything from infrastructure (Blockchain/Bitcoin) to credit, payments, settlement, processing, analytics, and discrete detailed solutions. What annoys me is the Fintech lists that throw companies together from all walks of life and rank who is best in innovation. For example, here is KPMGs Top 10 Fintech Innovators: 1. […]

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Why Online Lenders are a threat to Factoring – Part II

- January 14, 2015 4:42 AM | Categories:

images One could argue that Merchant Cash Advances are a huge threat to factoring. They have several distinct advantages (and disadvantages) compared to commercial finance companies. The hoops that a borrower must go through with a factor are several and very operationally intensive. Loan Set up – the borrower must send the finance company their Accounts Receivable, their Accounts Payable, and contra accounts for the factor to underwrite the credit worthiness and assess the willingness of their portfolio of account debtors. It is operationally intensive. With MCA, you send me your historical Credit Card and you can have an advance later […]

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Merchant Cash Advances evolve to Online Lending Platforms – Part I

- January 13, 2015 4:35 AM | Categories:

images We are seeing financial innovations over the last few years that we have not seen ever. Period. Small business lending has seen the brunt of these changes, and these innovation can be directly attributed to data, analytical models, and improving credit scoring models. Before the financial recession of 2008, banks made small business loans based on various automated technologies. But since that time, they have backed off and the void has been filled by Peer to Peer or Marketplace lenders, and Merchant Cash Advance (MCA) products that have evolved beyond financing a company’s credit card receivables. Just what are MCAs? […]

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