Ebury: Solution Overview (trade finance services for smaller global businesses)

One of the biggest challenges for small- and medium-size enterprises trading globally has been the lack of access to the kind of financial services readily offered by banks to multinationals.

Today, businesses of any size can think and trade globally, but the services to support them may not be offered by their bank. A $100 million or $250 million business may have a few bank relationships. Smaller businesses may only have one bank relationship.

Your banker and other lenders may not be able to support you with the credit you need to conduct foreign exchange (FX), cross-border payments, payables finance and international collections.

This is a real challenge that businesses face.

International Trade Services has been at a very serious crossroad for many banks for several years — as significant staffing and regulatory issues continue to plague the business and technology investments need to be made but do not have a strong business case.

Outside of the large global and super-regional banks that offer trade finance, risk management services, international payments and other international services, many banks don’t have their own dedicated staff, technology or resources to offer a suite of international services to their customer base. While some of the larger banks offer outsourcing services to other banks, there is not a dedicated focus to help companies in the $50 million to $1 billion sales segment. The cost to serve and the capital to dedicate typically outweigh a dedicated effort to build capabilities.

There is a persistent message in the market that a large trade finance gap exists for small businesses. This coincides with surveys done by the Asian Development Bank and the International Chamber of Commerce who look at bank-reported rejection rates for trade finance transactions and estimate that the global trade finance gap remained large and stable at $1.5 trillion. The International Finance Corporation, part of the World Bank, estimates a US$4.7 trillion finance gap for small and medium enterprises (SMEs) in emerging markets.

Ebury was started in 2009 to help small and medium business do cross-border trade. Ebury is able to bundle trade finance and risk management capabilities that are normally available only to larger enterprises of $1 billion+ and provide these kinds of services to smaller businesses. Ebury attempts to offer what large multinational banks offer to smaller companies.

Let’s take a look at the company and its solution.