Asia’s estimated $600 billion trade finance gap is an enduring problem – but supporting and facilitating a sophisticated secondary market for trade finance assets may be, at least part of, the solution. UniCredit’s Holger Frank, Head of Global Transaction Banking and Financial Institutions Group, Asia Pacific, and Siow Chin Yeo, Head of Trade Finance, Asia Pacific, opine in The Asian Banker that digital advances are turning this vision into reality.
With compliance issues, regulatory capital requirements and tightening margins restricting banks’ ability to lend to SMEs (who contribute two-thirds of Asia’s trade finance gap), new digital platforms are being developed that offer trade receivables to non-bank investors on a secondary market, argue Frank and Yeo.
CCRManager, which launched in 2017, is one such example. Processing $1.5bn worth of transactions to date, it’s helping to increase bank trade finance lending and, ultimately, boost the Asian economy.
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