To Renminbi or Not to Renminbi – What should Procurement Organizations do?

- February 26, 2015 3:33 AM | Categories:

renminbi-228x138 When a Chinese company asks you to do business in RMB instead of the USD, are you ready? Are your Chinese suppliers able to reduce prices if you buy in RMB instead of USD or Euros? Following the November 2014 announcement by China’s central bank naming Canada as a Renminbi Settlement Hub, work is currently in progress to put the necessary infrastructure and processes in place to allow for RMB-denominated transactions to be settled and cleared between North American and China using a settlement hub in Vancouver, B.C. I recently attended a workshop provided by AdvantageBC on Canada’s role as […]

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Electronic Invoice Marketplaces – To Sell or Not To Sell? Part I

- February 25, 2015 3:06 AM | Categories: ,

bank-notes-bills-buy-2114 This post on Electronic Invoice Marketplaces kicks off Trade Financing Matters six part series. Auction-based invoice finance has generated considerable interest within the finance industry because it provides new opportunities for companies to find alternative sources of liquidity and it also provides new opportunities for institutional investors to invest in short term receivables at attractive yields. The Receivables Exchange (“TRE”), established in 2007, was the first real-time online marketplace for working capital financing. Since that time, invoice auction markets have been started in many countries. MarketInvoice and Platform Black have displayed growth since launching in early 2011 and 2012 respectively. […]

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Does Orbian really have the Best Supplier Support and Enrollment Platform?

- February 24, 2015 4:43 AM | Categories:

world-best-1 I’ve written that Supplier Support and Enrollment, hereby called onboarding, can mean different things to different people but in this context is specific to onboarding suppliers to enable some early pay finance technique. The marathon to set up a supply chain finance program is over, you’ve found a great new platform and funding partners and the contracting has just concluded. The opportunity looks great, so you toss everything over the fence to your partners to get it sorted and sign up suppliers to the program. And then nothing happens. I did a series of post highlighting some of the Front, […]

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Will Reverse Factoring cause the next bubble?

- February 23, 2015 5:33 AM | Categories:

burst-bubble Alejandro Serrano, a professor of Supply Chain Management in the MIT-Zaragoza International Logistics Program and Spyros Lekkakos is a doctoral candidate in the same program recently penned a post on reverse factoring causing a bubble. Recall Reverse Factoring is a financial arrangement where banks or non banks use a favorable credit rating of large, solid buyers to secure Libor or Euribor priced money for suppliers. Their argument had several flaws. Flaw 1: These programs are for cash-starved suppliers Reverse Factoring programs are typically targeted at large spend suppliers (eg. greater than $25 million) for several reasons. One the cost of […]

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How to Kick Start SupplierPay

- February 19, 2015 11:32 AM | Categories:

ad09a3f8724bfb1ee4c0baac3a5d40ce When I speak to the Small Business Administration and Department of Commerce folks about SupplierPay, they always comment how passionate I am about the issue. And I always come back with the same response – I am a micro business and chasing payments is wasted energy and getting paid on time matters a lot, it’s that simple. Plus I like that the fact that the SupplierPay Pledge is a win win win game, micro and small businesses have options for early payment (or at least not extended terms), large companies can help small suppliers and their supply chain and vendors […]

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Do you SEPA?

- February 19, 2015 3:15 AM | Categories:

logo_sepa_41 There are plenty of sites that talk about what SEPA actually is.  SEPA is short for the single euro payments area (SEPA) and facilitates harmonized payments transactions between euro-currency countries and some non-euro countries (e.g., the United Kingdom, Sweden) at the same cost as a domestic transaction. Eurozone countries had to meet the SEPA migration deadline by August 2014, while non-euro countries have until 2016. If you are in the States, you can think of SEPA like the U.S. domestic ACH network for debits and credits but being able to move money across borders.  Pretty cool and while any change […]

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Way Past Due: Mandatory E-Invoicing by the Federal Government

- February 18, 2015 5:35 AM | Categories: ,

0017-logo-366x366 Trade Financing Matters welcomes this guest post form Bob Solomon CEO, Software Platform Consulting. Bob is a B2B information network guru who helped build the Ariba Supplier network business. I don't care if you are liberal, conservative, Tea Party or uninterested, here's a policy you should support: The US Federal Government should phase-in a requirement that all entities that do business with it should have to submit an electronic invoice to the Federal Government to get paid (and probably get paid electronically as well, though payment initiatives seem to exist). This policy would have so many benefits for the government, […]

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Best Global Supply Chain Finance provider – Standard Chartered Bank

- February 17, 2015 3:13 AM | Categories:

standard-chartered-logo Is Standard Chartered Bank the best global Supply Chain Finance Bank? According to Global Finance magazine it is. Standard Chartered has an enviable franchise in the Middle East, Asia and Africa, and deals with small and medium sized suppliers in those markets. They are generally not a strong franchise in OECD markets, and focus on serving a select portfolio of large corporates that fit their strategy. Given their relationships with many small suppliers, they can focus solutions where there is more value added – such as pre shipment or purchase order finance. See Jason’s post Beyond Approved Invoices: Using a […]

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Collateral Lenders, Relationships, and New Data Driven Underwriting Models

- February 16, 2015 3:06 AM | Categories: ,

bank-notes-bills-buy-2114 I recently had a number of discussions with collateral lenders (asset based lenders, factors) around early pay techniques eroding their receivable base. The consensus was a collective “Huh, I don’t see that with my client base.” Is Chicken Little running around saying the sky is falling? Certainly it’s not today. Most of these new models barely register a blip on their radar screen when it comes to their clients using new forms of finance.   There may be the odd exception or two, but it’s very early days and like Jason Busch likes to say, we are in the first inning […]

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U.K. Government looking to legislate late payment penalties

- February 12, 2015 5:42 AM | Categories:

kindergarten-detention-tardy I wrote a piece back in November on this, see The Unintended Consequences of Legislating Late Payments In a December 2013 discussion paper titled Building a Responsible Payment Culture options were explored for taking further action on late and extended payment. These included creating increased fines, third parties reclaiming debt and other radical options. Respondents were clear that, whilst they wanted to see a reduction in late payment, they did not want government to constrain their freedom of contract. Today, the Small Business, Enterprise and Employment Bill is currently before the U.K. Parliament to enable the UK Government to subsequently […]

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C2FO Update – A Working Capital Market in the Making

- February 11, 2015 4:00 AM | Categories:

images C2FO has been operating what they call their working capital market for close to five years now and clients include Costco, Walgreen, Sysco, ToyRUs and Toshiba. For those who are not familiar with what a Working Capital Market is, in C2FO’s case, suppliers provide a rate at which they will discount their invoice for early payment.  This is a significant point of distinction.    Suppliers have the ability to set their own price for early payment.  C2FO’s marketplace technology will route these offers to the buyers in the marketplace to determine whether the rate is accepted based on a number of […]

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World’s Best Supply Chain Finance Providers – Or so They Say!

- February 10, 2015 1:50 AM | Categories:

world-best-1 Global Finance names Worlds Best Supply Chain Finance Providers – Really? When somebody says World’s Best, I stop and take notice. LeBron James is arguably the best basketball player on the planet. His performance can be evaluated almost daily and is transparent to all. But some of the providers on this list left me wondering, just how in the heck does Global Finance name the World’s Best. I mean some of the vendors on that list are either start-ups, are still relatively small, or are having major challenges with their business model. So I asked Denise Bedell, Managing Editor, Global […]

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