Blockchain: The Possible Answer to Trade Finance ModernizationFebruary 16, 2017
Recently, a study was conducted by the capital financial technology giant, C2FO, regarding European treasures. Herein, it was found that 75% of these treasurers are supposedly focussing on investing in trade finance technology, in the following year of 2017.
Colin Sharp, who holds the position of senior vice-president, EMEA at C2FO, is of the opinion that the shifts within the microeconomic environment, are resulting in the pressuring of corporates, in order to refocus their efforts to trade finance. He further goes ahead to say, “Treasurers are facing a lot of uncertainty, both from the United States of America and as result of the on goings around Brexit. This is putting immense pressure over the supply chain, and with the demand increasing and decreasing. Treasurers want the ability to use their assets to make returns and give some certainty.”
There have been more and more efforts, which are offering insight into, finding out how blockchain can supposedly be used, in order to benefit small as well as medium size ventures. Any said digital trade chain, supposedly wants to achieve a perfect balance, between identification of opportunities and connecting them with each other and their banking partners. This would be made even simpler, when banks would bring in their own client bases herein, thus eliminating rigorous on-boarding.
Anne Claire Gorge, who holds the position of the head of the product management department, trade services, and finance of Societe Generale, is of the opinion that, treasurers believe that more control over trade finances, can help them greatly in the other areas of business. She says, “Better use of trade finance helps theses treasurers, to have a greater overview of their working capital positions. Offering financial solutions to suppliers, for instance, in order to improve the terms of payments, helps greatly in guaranteeing cash flow.” She is of the firm thought that the deployment of latest technology will definitely end up simplifying the process. In her words, “Trade happens to be very heavy on letters of credit or invoicing solutions, making it complicated to finance receivables and payables. Doing all this, as a part of a digital solution, has great potential of making it easier”.
The experts believe that a little rocking, cannot cause any harm to the ship, in financial jargon, they are basically hinting at the climate of uncertainty. Especially when it comes to Banks, a little uncertainty does not seem to be a negative thing. This actually makes for a rather encouraging temperature for the requirement of trade finance tools, in order to offer stronger guarantees. The solution for the entire thing can finally come from block chain, is the combined belief of all the trade finance gurus. But for this concept to see the light of the day, there needs to be a rigorous industry wide effort, in the direction of implementation.
As many changes take place, in order to develop and strengthen the field of Trade Finance, the number of aspirants herein also multiplies. This is why professional training institutes like Imarticus Learning seem to be getting popular by the day.