HSBC has called time on Serai, its wholly owned subsidiary that operated as an online B2B platform for SME trade, after the venture failed to make money.

Originally launched in 2019 as part of the bank’s multi-billion-dollar technology investment plan, Serai boasted the kind of backing and resources that few trade startups could ever dream of.

Serai’s inception had its roots in 2017, when HSBC’s senior leadership put out an internal call for new business ideas. Vivek Ramachandran, then global head of growth and innovation, pitched a high-level business case around the need for a platform where buyers and sellers come together to facilitate business-to-business (B2B) transactions. Noel Quinn, at the time CEO of global commercial banking, sponsored the idea, and Jasmine22 (as it was then called) was born.

Founding the startup, Ramachandran, took with him a handful of top talent from the bank, including Khuresh Faizullabhoy, HSBC’s global head of GTRF services, who served as Serai’s chief product officer before leaving in 2021 to join Standard Chartered; and Andrew Dennison, the bank’s managing director of commercial banking growth and innovation, who took on the role of COO.

Initially, the venture was set up as a lending platform for Hong Kong-based SMEs. Speaking to GTR in 2019, Ramachandran said Serai would offer a digital, machine learning-backed credit scorecard and a trade loan. “We have started testing that product with live customers, ie lending money. The intention is not to make a big splash about it; we will work our way through from single digit numbers of customers upwards,” he said.

However, the political unrest in Hong Kong and the impact of the Covid-19 pandemic presented a challenge to this business model. The company then focused on its value proposition as a B2B platform where suppliers and buyers could search, find and connect with each other via their trusted networks.

“Serai is a strategic initiative for the bank, and we have got backing at the highest levels of HSBC. It solves for a big non-banking trade problem that companies around the world are consistently expressing and it’s an opportunity to create a huge amount of value by serving that need,” Ramachandran told GTR at the time.

In a further statement, he added: “If you have got Facebook for your personal network, LinkedIn for your professional network, Serai is for your company.”

In mid-2020, as the pandemic battered apparel supply chains in Asia, the company pivoted its focus to the garment industry, partnering with two digital applications, Coats Digital and Res.Q, to provide the sector with real-time data and end-to-end supply chain transparency.

“Companies are going to have to find ways to showcase themselves digitally, they’re going to have to share data digitally, and that is with existing buyers but also with new buyers,” Ramachandran told GTR. “How do you choose a new supplier when you can’t visit them and you can’t do full audits? In a world of tighter margins, how do you stamp out inefficiencies? How do you measure productivity and minimise wastage and rejects? How do you mitigate the risks upstream and downstream with buyers and sellers? The industry is going to have to start using data in a much smarter way, and this partnership offers a means through which companies can do this.”

At the end of the same year, the venture signed a partnership agreement with Coface, bringing the trade credit insurer’s counterparty risk management tools into its solution, with the two sides saying they would work together to combine their business ecosystems to guide companies through the complexities of global trade.

In 2020, the platform also set up a development team in China, registering a new entity, Serai Technology Development, in Shanghai. By this time, Serai had a headcount of almost 100 full-time employees, but was yet to turn a profit.

A further pivot happened in 2021, amid a growing demand for environmental, social and governance (ESG) improvements in supply chains. In January that year, the company began to pilot a solution that would allow apparel companies to trace the origin of the cotton and other raw materials that go into their products. Ramachandran told GTR that future add-ons would include working capital and supply chain finance from both HSBC and external financiers, as well API functionality to integrate invoice checks and audits.

By August 2021, Serai was seeing “exponential” uptake, according to Ramachandran. “When we went live in the first quarter of 2020, we had 250 companies on the platform. We now have 9,000. Cotton traceability is one use case. Tomorrow, it might be carbon emissions or water use. The industry will evolve.”

However, despite eye-watering levels of funding and support from its large bank parent, Serai’s success was far from assured.

Speaking to GTR on condition of anonymity, a former Serai employee says that Ramachandran called an all-hands meeting in early May and that those present were advised that HSBC had decided to put Serai “under review”.

“Vivek clearly mentioned in the all-hands that the financial discipline issue of Serai was the reason,” the former employee tells GTR, adding that the bank had made a “US$70mn investment” into the venture, which had generated only a small amount of revenue.

“In the all-hands, some employees were upset, especially those who recently joined the company, as Vivek and Andrew [Dennison] had promised the new joiners a long-term commitment from HSBC for Serai,” the former employee says. “When some employees questioned this, [Vivek] responded that he had expected the bank to continue its financial support, and that all options were put to the board of HSBC, including a sale to a competitor or the restructuring of Serai to raise external capital.”

Ramachandran then left the company, returning to HSBC to take up the role of global head of global trade and receivables finance. Dennison, who was leading Serai’s supply chain solutions, took over as CEO.

The former employee tells GTR that, following Ramachandran’s departure, Serai’s operations were put on hold. At the end of May, the former employee says, another all-hands meeting was called by Dennison who announced that HSBC had decided to shut down Serai. HSBC declined to comment when asked by GTR if Dennison would also be returning to the bank.

“We regret to inform you that Serai will be winding down all operations,” Serai says in a statement posted on its website. “Despite a huge amount of progress made by the team, it has proven difficult to build a commercially viable business. As a result, we’ve made the difficult decision to close our doors.”

According to information on Serai’s website, the Serai network will be shut down on June 25.

The news comes just days after another HSBC-backed startup,, closed down after being unable to secure further investment. The blockchain-based platform for open account trade was jointly owned by 12 European banks and IBM, with further shareholders including CaixaBank, Deutsche Bank, Erste Group, KBC, Nordea, Rabobank, Santander, Société Générale, UBS and UniCredit.

An HSBC spokesperson tells GTR that “the decision to wind down Serai follows a thorough business review and is a purely commercial decision. We continually review our commercial investments to ensure we have the right strategic approach for the long term. We remain committed to advancing the digitisation of trade for the benefit of our customers.”