Corporate demand for trade finance is not being met by banks in Asia, a study has found.

Research firm East & Partners Asia’s inaugural Trade Finance Report says that Asian companies are extremely dissatisfied with the trade credit service provided by banks.

The report interviewed CFOs and treasurers of the 1,000 largest companies in Asia (excluding Japan), finding that there was less than 50% satisfaction with the trade credit process.

Access to trade finance is viewed as the second-most important consideration for respondents, after business growth. 31% of respondents said that liquidity is the most important element in achieving this growth.

The manner in which banks are delivering trade credit came in for strong criticism. Almost a quarter of respondents said that strong trade credit delivery is the single-most important factor in choosing a banking partner.

The figures echo a report issued by the Asian Development Bank (ADB) last year, which found that there is a US$1.6tn global gap in trade finance, with US$425bn in developing Asia.

The ADB’s head of trade finance Steven Beck tells GTR that the bank is working on a follow-up survey, due in Q4 this year, and that he expects the issue to be argued equally forcefully.

He says: “We see gaps for trade finance. We knew it anecdotally and from talking to banks that have a hard time establishing bank limits for challenging markets, and where they are able to establish limits they tend to be insufficient to meet demand.”

The ADB’s trade finance programme can assist to an extent, by issuing guarantees to banks and companies operating in challenging markets such as Pakistan, Bangladesh and soon, Myanmar.

In last year’s survey, the ADB found that if companies had an increase in access to trade finance products of 10%, they expected to see additional business growth of 5%.

Commenting on the survey’s findings, Paul Dowling, principal analyst at East & Partners Asia says: “It’s clear from the research that the banks are failing to fully deliver on the credit piece, which is so critical to trading businesses which need that liquidity support. At the same time, the feedback on account officers should be a wake-up call to the banks which sends a clear message to aspirants and challengers in this increasingly competitive market space.”