SESAMi E-Financial Services Marketplace (SFSM) will create the first on-demand, event triggered, transactional financing and factoring platform in Singapore where businesses seeking funds are matched with a broad base of lenders, ranging from financial institutions to private investors. Financing opportunities are made available to SMEs throughout their trading cycle from contract award to invoice approval, allowing them to optimize the management of working capital and liquidity tied up in supply chain processes.
Taking the experience from SESAMi’s successful e-Financing program with TradeXchange and DBS, SFSM will push the envelope of traditional supply chain financing. Building SFSM as an extension of SESAMi’s established Strategic Sourcing, Procure-to-Pay and Order-to-Cash platforms to provide financing opportunities on sourcing and procurement transactions (i.e. Contract Award, PO, GRN, Invoices), SFSM will also tap on SESAMi’s large e-marketplace trading communities and thereafter extend its services to non-trading partners both locally and globally.
BENEFITS TO E-TRADING COMMUNITY BUYERS
Provided a basis to improve payment terms with suppliers
Improved cash management
Improved supplier relationships by offering financing option with potentially lower borrowing costs
Provided a more stable supply chain at no additional cost
BENEFITS TO E-TRADING COMMUNITY SUPPLIERS
Streamlined and faster process for application and submission of supporting documents
Provided accelerated payment options
Potentially lower financing cost
Reduced payment and foreign exchange risk
Reduced cost for courier services (submission of documents)
SESAMi E-FINANCIAL SERVICES MARKETPLACE
SFSM is a secure and neutral platform for the matching of financing demand and supply, integrating key business processes, data and document management of different stakeholders to enable a straight through financing transaction. As a many-to-one-to-many e-hub, SFSM will provide one-stop connectivity to financial institutions, peer lenders, trading communities, insurance companies and external plug-in verifiers from government agencies and other B2B e-hubs.
SESAMi currently process $12 billion of RFQ / tender quotation, $6 billion of purchase order and $2 billion of e-invoice on the e-procurement marketplace. These transactional level trade data captured facilities the creation of financing request on our platform. Using straight-through processing and data at source, businesses can now activate financing at the point of need, allowing businesses to better balance their financing needs and financing costs.
TRADE EVENT TRIGGERED TRANSACTIONAL FINANCING
Suppliers need a working capital loan to finance purchases of raw materials and to fund operating expenses for manufacturing and labor. Using event triggered transactional financing, suppliers are provided with funds as early as contract award to purchase order received. Typically, a percentage of the contract / PO amount is provided to mitigate the higher risks involved for financing early in the trade cycle.
SESAMi’s e-finance solution, which leverages on the TradeXchange® platform, allows the exchanging of documents between businesses and banks to speed up the trade finance application process.
The manual-intensive verification process is now replaced with a reliable three-way matching solution by SESAMi. Applicants and banks no longer need to manually match the information on application forms and the attached supporting documents.
Through the TradeXchange® platform, submitting documents from businesses to banks is now more simplified. Administrative work is significantly reduced. With the increase in productivity, banks can now re-align their resources to drive other key growth areas. The decrease in administrative cost also allows the bank to offer more affordable financing services to a larger group of customers.
Click to view the article published by TradeXchange on the The Straits Times.
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