DBS Bank has partnered with business cloud software company Infor to integrate digital trade financing capabilities into the Infor Nexus global network of more than 68,000 businesses, the technology firm said recently.
The two companies’ first joint program lately went live with one of the world’s largest global apparel companies, providing faster and more cost-efficient digital trade financing to suppliers in the apparel company’s supply chain ecosystem which comprises mostly small-to-medium-sized enterprises (SMEs), Infor noted but declined to name the apparel firm.
DBS Bank’s collaboration with Infor enables greater transparency into complex supply chains and provides insights into the transaction patterns between an anchor and its ecosystem of suppliers, said Sriram Muthukrishnan, Group Head of Trade Product Management, DBS Bank.
The bank aims to leverage these insights to provide quicker and more cost-efficient financing to suppliers much earlier in the cycle, as compared to conventional post-shipment supplier financing programs, he added.
“This is especially relevant today, as we continue to operate in an environment characterized by prolonged trade disruptions and tighter credit lines, where optimal working capital management is key to survival,” Muthukrishnan pointed out.
Next stage: Pre-shipment finance
The two companies’ next joint program for pre-shipment finance, expected to launch in late 2020, will utilise supply chain data as the primary conduit to assess risk and credit worthiness, as opposed to traditional models that result in the majority of suppliers being under-funded or facing challenges to access necessary capital, Info pointed out.
According to the software firm, it provides supply chain data, including historic and real-time milestone information on the physical movement of goods, to enable a data-driven representation of a supplier’s performance and credit risk.