In response to ever-increasing trade volumes through the US importation supply chain, Bank of America Global Treasury Services (GTS) has announced substantial enhancements to its trade product offerings.
“The growing volume of imported goods into the US and resulting pressure on transportation industry systems point to the need for efficient and cost-effective trade payment system tools,” says Paul Johnson, senior vice-president, Bank of America Global Treasury Services. “That’s why Bank of America is doing everything it can to make sure the trade community is equipped with best-in-class payment technology. In fact, we believe Bank of America now offers the most efficient and robust financial supply chain tools available to US importers.”
According to Johnson, the enhancements are best demonstrated in two trade products: Purchase Order-to-Pay and Trade Payables Discounting.
Bank of America’s Purchase Order-to-Pay, a buyer or importer-centric payables solution, handles multiple payment terms and can be integrated with major purchase order and ERP systems. New in 2005, Purchase Order-to-Pay supports both domestic as well as the cross-border merchandise procurement.
Purchase Order-to-Pay continues to handle all standard payment terms (letter of credit, documentary collection and open account) and payment methods (wire, draft, ACH and PCard), but now can be combined with electronic document presentation on the vendor/supplier side to create a seamless, automated payables process from PO issuance, export document preparation and presentation, reconciliation, payment/financing and settlement. Trade Direct, the Bank of America web-based front-end system, continues to provide buyers with full visibility throughout the payment cycle.
Designed to leverage a buyer’s credit rating to provide financing to vendors, Trade Payables Discounting allows the buyer to improve working capital by increasing its account payable terms.
In order to relieve the financial pressure this places on the suppliers, Bank of America provides suppliers with the opportunity to discount the pending invoices. This programme reduces the cost of borrowing for suppliers, allows buyers to negotiate better (extended) payment terms and ultimately reduces the costs in the financial supply chain for both the buyer and supplier.
Like Purchase Order-to-Pay, Trades Payables Discounting now can be used for both domestic and cross-border financing and be interfaced with the majority of ERP and procurement applications. The bank offers both manual (paper draft) and automated (web-based) versions of the programme depending on the preference of the supply chain participants.
“Purchase Order-to-Pay and Trade Payables Discounting are the front-end and back-end of a single, integrated, end-to-end supply chain solution,” says Johnson. “Together, and with our latest electronic delivery channel enhancements, they are the best option in today’s market for US-based importers.”