Finastra and the International Chamber of Commerce today announced a collaboration for combating the growing trade finance gap, thus offering micro-, small, and medium-sized enterprises (SMEs) access to a set of alternative financial resources. Finastra-powered ICC TRADECOMM marketplace is expected to reduce trade finance barriers for SMEs and enable all parties to benefit from improvements in matching supply and demand.
ICC Secretary General, John W.H. Denton AO said, “If SMEs are going to survive the ongoing economic crisis, they need tools and solutions that will enable them to trade now. Only then will many micro-, small-, and medium-sized enterprises be able to seize new business opportunities and build back their activity post-pandemic. We are extremely pleased to partner with Finastra on ICC TRADECOMM, one of the solutions that ICC will unveil as part of its commitment to connect investors and SMEs looking for short-term liquidity for their international trade operations.”
According to Finastra, ICC TRADECOMM will allow investors to finance trade transactions against title documents and equip SMEs with a set of solutions to mitigate perceived risk, the burden of compliance, and enhance access to finance.
The companies aim to launch a series of pilots across markets before the final rollout. The pilot will see the bank and non-bank financiers be given the opportunity to transact on invoices from SME suppliers from select marketplaces. Subsequent versions of ICC TRADECOMM may include other trade documents, such as letters of credit, bills of lading, and other bank-syndicated products, in a move towards creating seamless documentary flow.
Simon Paris, CEO at Finastra said, “Access to, and availability of, financing for SMEs continues to be a significant challenge and this is only worsening as the pandemic continues. These organizations make up around 90% of the world’s businesses and are the lifeblood of their communities. We have an obligation to redefine finance for good, to help reduce this gap and drive global economic equality. Our plans with ICC to establish and orchestrate this ecosystem are designed to do exactly this and keep trade moving.
Our shared ambition is to facilitate millions of dollars in trade financing for SMEs. We are at the beginning of an exciting journey together, a journey towards reducing friction in trade and providing open finance for all.”
Pascal Lamy, President of the Paris Peace Forum and Former Director-General, World Trade Organization said, “For many SMEs, access to trade finance is access to trade. As the trade finance gap continues to grow, especially amidst the pandemic, so too do obstacles to trade, export growth and economic prosperity. Developing trade finance is as important as reducing obstacles to trade. This partnership between ICC and Finastra is a step in the right direction.”