Tuesday, 27 July 2021

DBS Bank to partner with AntChain in digital international trade and financial service platform

DBS Bank announced that it is the bank partner on AntChain’s newly-launched blockchain trade platform, Trusple, which aims to democratise access to digital trade services to corporates of all sizes.

Developed using AntChain’s blockchain technology, Trusple will leverage the digital financing capabilities of DBS and four other member banks, namely BNP Paribas, Citibank, Deutsche Bank and Standard Chartered, to provide an integrated platform for distributors and suppliers to trade their products and access trade financing digitally in real-time. The one-stop trade platform aims to facilitate greater acceptance and adoption of digital trade processes among corporates, especially small-to-medium sized enterprises (SMEs) which face many pain-points when it comes to international cross border trade.

Tan Su Shan, Group Head of Institutional Banking, DBS Bank, said that DBS’ partnership with AntChain underscores its commitment to SMEs in providing optimal and timely working capital support which is key to their survival in this period of prolonged trade disruptions.

“DBS is excited to be the first Asian bank to partner with AntChain. This partnership speaks to our accelerated deployment of market-leading digital and data-based financing capabilities to ensure steady financing to SMEs. Our collaboration with Ant will enable the use of data to provide greater transparency into complex, fast-moving supply chains. We can then leverage this data to deliver quicker and more cost-efficient financing to counterparties on the Trusple platform.”

According to a DBS survey polling around 1,700 corporate treasurers, CEOs, CFOs and business owners across the Asia-Pacific, almost all businesses (99%) have indicated that they are facing external pressure to transform digitally, with key pressure points including changing consumption patterns from their customers and key markets, competitors and growing supply chain complexities.

Guofei Jiang, Ant Group Vice President and President of the Intelligent Technology Business Group, said, “At AntChain, we aim to build transparency and strengthen trust in trade ecosystems that involve large numbers of participants and complex processes. We have therefore been accelerating blockchain-enabled industry transformations, working with our partners to make blockchain technology more accessible for users, as well as creating tangible value for SMEs, consumers and clients across a spectrum of industries. We remain committed to the mission of Ant Group to make it easy for companies to do business anywhere across the world.

We are privileged to launch the Trusple platform with DBS and other international partners to help SMEs participate in international trade more conveniently and efficiently. At the same time, we welcome domestic and overseas partners to join the Trusple ecosystem and jointly build a digital trading network to serve SMEs around the world.”

Traditionally, businesses engaging in cross-border trade tend to be subject to complex and lengthy processes that often rely on paper-based trade documents, resulting in long delivery cycles that can stretch for months before goods and payment are received by the buyer and seller respectively. This is where Trusple offers an attractive proposition for businesses of all stages of the digital transformation cycle with its easy-to-navigate interface, immutable data qualities and seamless one-stop access for all trade and financing needs.

On the Trusple platform, when a digital trade order is generated by a buyer or seller, it will be automatically recorded on the blockchain. This helps enhance transparency in complex supply chains, fostering greater trust between parties which may not have transacted with each other before.

As an added safeguard, DBS, along with other member banks, will also offer payment guarantees for all goods traded on the platform, whereby the financing bank will automatically dispatch payment to the seller once the buyer digitally acknowledges the receipt of goods on Trusple. This mitigates the risk of late payments and allows suppliers to enjoy greater predictability of cash flows, enabling them to better optimise their working capital for strategic opportunities to grow their business.

Additionally, member banks can also harness insights from the transactional data between buyers and suppliers to determine the credit quality of the business and offer competitively-priced trade loans through the platform. For instance, through Trusple, DBS is able to facilitate applications for trade financing in real-time and offer credit lines in less than 24 hours.

Committed to democratising access to digital trade and trade finance

DBS continues to make steady progress with its strategic partners and corporate customers to enhance the accessibility of digital trade services and financing for businesses, large and small, in both the upstream and downstream legs of supply chains. Further accelerating the digitalisation of trade finance, the bank’s market-leading onboarding capabilities allow small suppliers to get activated on DBS supply chain programmes within a day.

DBS’ supply chain financing business continues to show healthy growth across its core markets, with 24% year-on-year growth and higher digital adoption by companies. Similarly, the bank’s documentary trade business has also shown stronger digital adoption. Since the start of 2020 until August, the number of customers transacting via IDEAL Trade[2] has increased by 20%, with a 15% increase in the number of transactions per month.

In terms of digital trade initiatives to support the liquidity needs of small and medium-sized enterprises (SMEs), DBS launched a digital financing facility with Haier Group, a leading Chinese consumer electronics and home appliances enterprise in April, enabling its ecosystem of distributors to access affordable financing for their purchase orders in a simple and fast manner. This initiative also helped enhance the resilience of Haier Group’s supply chains during the pandemic months as DBS was able to provide digital credit lines to its distributors within 24 hours, providing them the cash flow they need to keep their businesses going.

At an industry level, to drive a collective effort to digitalise global trade, DBS was the first Singapore bank to join Contour’s blockchain network. Since the bank became a member in May, it has successfully completed four transactions on the blockchain platform. DBS has also partnered with Infor, a global leader in business cloud software, to integrate digital trade financing capabilities into the Infor Nexus global network of more than 68,000 businesses in July.

Re-disseminated by The Asian Banker