Supply chain payments specialists Tradeshift this morning rolled out a unified cloud-based supply chain payments and finance solution that is compatible with “all major blockchain technologies including ethereum and hyperledger”.
The Californian-based company aims to help deliver payment options including virtual card payments of invoices and purchase orders, dynamic discounting, supply chain finance through bank partners or blockchain-based payment through one platform with the solution, “Tradeshift Pay”.
CEO Christian Lanng told Computer Business Review: “We’ve been working on this for 18 months. We’ve done an extensive pilot with logistics company Kuehne & Nagel. We’ve lent nearly $1 billion out on it. It’s our own architecture end-to-end.”
The one-stop-shop platform can work on and off blockchain as well as allowing smaller unbanked businesses and companies to access electronic payments and finance anywhere worldwide, the company says.
It also allows all suppliers to connect to the same cloud solution, which also handles everything from invoicing to tax compliance, via settlements and early payments, with an “open multi-bank” network including HSBC, Santander, Citi, American Express and CreditEase. Users can also “bring their own bank”.
In essence, Lanng tells Computer Business Review: “It turns any kind of transaction into a digital asset. Assets may be recorded to relevant blockchains. Users can choose to connect the blockchains to the marketplace, e.g. giving access to financiers, and other parties interested in the transactions.”
The company adds that it is taking aim at a $9 trillion problem –namely, the global capital trapped in accounts receivable as a result of archaic payment practices and the digital disconnect between large business buyers and their suppliers.
CEO Lanng said in a release: “For the first time, businesses can go to one single wallet to handle all their payments, end-to-end, across all channels. And for the first time, you can do both regular and blockchain-based early payments in one platform in the cloud.”
Globally, over $9 trillion in trade assets languishes on supplier balance sheets as receivables. A report by the World Trade Organization (WTO) states that over half of global trade finance requests by small and medium-sized enterprises are rejected.
An Ernst & Young study found that the leading 2,000 US and European companies have up to $1.3 trillion unnecessarily tied up. Yet, only 10 to 20 percent of outstanding receivables are intermediated by banks and other financial institution
Vinay Mendonca, Global Head of Product and Propositions, Global Trade & Receivables Finance at HSBC said: “Modernising trade and supply chain solutions is a strategic priority for HSBC. We are investing heavily to enable simpler, better and faster experiences for clients.”
He added: “Our partnership with Tradeshift allows us to provide fully digitised and automated working capital propositions across the entire supply chain ecosystem, supported by the breadth and depth of our global network. We are really excited to offer our clients a full range of integrated propositions across the financing and payments spectrum.”