January 18, 2023 at 11:01 am #1834Joseph Klaus PeterParticipant
Explain the synergy between trade financing and supply chain financing.January 19, 2023 at 11:07 am #1836AdharshParticipant
There are many ways in which trade financing and supply chain financing are mutually beneficial. Risks, such as late payments from customers or lost shipments, can be mitigated with the assistance of trade financing. In contrast, supply chain financing facilitates better cash flow management by lending businesses money against their receivables and stock. When it comes to financing the exchange of goods among countries, trade finance is where it’s at, while supply chain finance is more concerned with transactions that take place within a single country or region. Supply chain finance is utilized to assist in the manufacturing, distribution, and shipping stages of a company’s supply chain, while trade finance is used to assist in the importing and exporting of goods.
By employing blockchain technology, Triterras’s FLEET platform unifies trade finance as well as supply chain finance. It provides safe and simple access to trade finance tools like letters of credit and working capital for businesses. Tokenization of their trade assets and inventory facilitates their use as collateral for supply chain financing. There is less opportunity for fraud and non-payment because of the increased visibility and transparency made possible by Triterras’ platform, which also enables real-time supply chain management and tracking for businesses.January 20, 2023 at 11:10 am #1838John DavidParticipant
The international trade industry has access to a variety of financing options, including supply chain finance and trade finance. In order to free up working capital, businesses can turn to either supply chain finance or trade finance, but these two approaches differ significantly. Financing the procurement of goods from wholesalers is a common application of supply chain finance. In most cases, a buyer will secure a loan based on the value of the merchandise being purchased. The buyer is then in a better position to make necessary expenditures or to reinvest in the growth of the business. The buyer is responsible for paying back the loan, plus interest and fees, once the merchandise has been sold. However, goods sales to buyers are frequently financed through trade finance.
The seller will obtain a loan based on the anticipated sale proceeds. The seller may then be in a position to use the freed-up funds for whatever purpose they see fit, be it meeting immediate needs or making long-term investments. The seller is responsible for paying back the loan plus interest and fees once the buyer has paid for the goods. Financial tools like supply chain financing and trade financing can help companies expand their global reach. Before deciding which of these two financing options is best for your company, it is vital that you fully grasp the key distinctions between them.
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