Supply chain finance is dominated by large global banks, yet developing regions are nurturing some challengers, and growing complexity is bringing nonbank investors into the picture.

Author: Anita Hawser

GLOBAL WINNERS

BEST SUPPLY CHAIN FINANCE PROVIDER—BANK

Citi

A consistent winner in this category, Citi boasts one of the most comprehensive supply chain finance offerings of the global banks and has an unrivaled global presence in more than 70 markets across North America, Latin America, Asia, Europe, the Middle East and Africa. SCF is part of the bank’s Treasury & Trade Solutions group, which saw continued growth in transaction volumes in 2016. Recent enhancements to its solutions include an automated Web-based supplier acquisition platform to streamline the supplier onboarding process. Clients looking to execute global cross-border SCF programs can rely on Citi’s local and regional market expertise. In addition to financing SCF programs itself, Citi’s Trade Risk Distribution team distributes SCF assets to a network of investors globally, a capability it is able to leverage to support the ongoing growth of a client’s SCF program.

BEST SUPPLY CHAIN FINANCE PROVIDER—NONBANK

Orbian

Orbian is one of the longest-established players in the SCF space, with more than 15 years of experience in providing SCF solutions to the world’s largest manufacturing, consumer products and retail companies and their suppliers. Orbian’s platform, which sells SCF financing notes to investors, has remained a mainstay of the SCF industry. The industry is undergoing rapid change due to the entrance of financial technology companies into the trade and supply chain finance space. Last year saw Orbian open new offices in Munich, Germany, and San Diego and issue $8 billion in financing notes.

BEST CUSTOMER IMPLEMENTATIONs OF A SUPPLY CHAIN FINANCING SOLUTION

BNP Paribas Green Supplier
Credit Financing

Supplier finance delivers working capital efficiencies for both buyers and suppliers, but when it is tied to “green” credentials such as a client’s sustainability goals, it can be even more powerful. To finance trade in green lighting technologies, BNP Paribas provided a one-off €16.6 million ($17.8 million) facility to discount sets of invoices due by two consortia to which the bank’s client provided LED lighting equipment for a lighting-renewal project in Madrid.

BEST CUSTOMER IMPLEMENTATIONs OF A SUPPLY CHAIN FINANCING SOLUTION

Deutsche Bank and Jumbo Supermarkten

Sometimes noteworthy SCF deals are more about the sheer scale and size of a program. In the case of Netherlands retailer Jumbo Supermarkten’s SCF program, the company needed to process 40,000 invoices a week—rather than the usual 400 or so—and it also needed to incorporate three partner banks in addition to Deutsche Bank. To accommodate Jumbo Supermarkten’s invoice processing needs,  Deutsche Bank bundled invoices into “packets” by maturity date at the point of transmission and then uncompressed them as they entered Deutsche Bank’s system, retaining their full information content for further processing, payment and reconciliation. Deutsche Bank also put in place an asset-based (factoring) finance facility for suppliers that bank with Deutsche Bank. This pays out on part of the invoice to the supplier even before the invoice is uploaded onto the buyer’s system, which means suppliers don’t need to wait for the invoice to be approved by the buyer.

BEST CUSTOMER IMPLEMENTATIONs OF A SUPPLY CHAIN FINANCING SOLUTION

PrimeRevenue and AGCO

Agricultural provider AGCO saw SCF as an opportunity to put itself in a more financially stable position than its competitors. It worked with PrimeRevenue to bring its SCF program online within a matter of months. So far, AGCO says it has generated about $20 million in working capital, in addition to over $100 million in direct material spending, which has been funneled through the program in less than a year. In addition to providing AGCO’s suppliers with low-cost capital, PrimeRevenue’s platform simplifies payment terms with suppliers in different locations.

BEST PLATFORM CONNECTING BUYERS, SUPPLIERS AND FINANCIAL INSTITUTIONS

PrimeRevenue

Relying on the cloud to deliver supply chain finance services, PrimeRevenue’s platform is designed to make it easy for buyers, suppliers and financial institutions to interact with one another. With more than 20,000 clients and 50-plus financial institutions, PrimeRevenue says it processed $120 billion in transactions last year. PrimeRevenue has provided supply chain finance and dynamic discounting solutions since 2003, across multiple jurisdictions and more than 15 currencies.

BEST E-PROCUREMENT

SAP Ariba

SAP Ariba offers a wide range of cloud-based solutions that cover the entire source-to-settle process, enabling buyers and suppliers from more than two million businesses and 190 countries to discover new opportunities, collaborate on transactions and grow their relationships. Some of its procurement solutions include: Procure-to-Pay, for catalog and contract compliance; Procure-to-Order, to help make front-end procurement processes operate with maximum efficiency; Procurement Content, for fast catalog enablement; Services Procurement, which utilizes SAP Fieldglass for automated procurement and workforce management; and Invoice and Payment, to speed up the purchase-to-pay cycle.

BEST ANALYTICS FOR CREDIT SCORING AND SUPPLIER RISK ASSESSMENT

Dun & Bradstreet

Managing corporate supply chains is not just about smart procurement and how and when you pay your suppliers. Credit scoring of suppliers and business analytics is essential to companies to help them minimize the effects of major disruptions (natural disasters, suppliers unable to deliver goods) in their supply chain. Dun & Bradstreet provides credit and risk management analytics that facilitate supply chain optimization and that help prevent business disruptions. Information on risk conditions, business profiles, financial indicators and the competitive landscape is provided on a software-as-a-service basis by Dun & Bradstreet.