HSBC has partnered with business commerce firm Tradeshift to enable its customers to manage their global supply chains and working capital requirements in one digital platform, and allow the bank to provide financing to companies much further down the chain.
San Francisco-based Tradeshift offers a cloud-based platform that connects more than 1.5 million companies globally, helping them keep track of their supply chains.
Over the past six months it has, together with HSBC, developed an integrated solution that puts an end to disconnected systems and paper-heavy supply chain processes, combining electronic invoicing, document matching and early payment capabilities into one place, and fully digital.
“It’s a genuinely game-changing proposition in terms managing supply chains,” said Vivek Ramachandran, HSBC’s head of proposition, global trade and receivables finance, at the launch of the new platform today, adding that it is the “first integrated finance solution built into the physical supply chain.”
The solution will not only improve the transparency and speed of invoice processing, but will allow buyers and suppliers to collaborate in real time, as well as give suppliers easier access to financing.
“[The platform] stretches deep into the supply chain, so unlike traditional programmes it’s not restricted to the largest suppliers,” Ramachandran said. “The upside for us is the ability to finance more clients earlier in the production cycle.”
Tradeshift CEO and co-founder Christian Lanng added that while the customers pay a fee to use the platform, it is free for their suppliers to join, “which means that the companies have been able to drive it much further down the supply chain, on average 70-80% digitisation,” he said.
The partnership comes after HSBC invested in Tradeshift in June last year, an amount that has not been disclosed. The two are planning a soft launch of the new solution in Europe in July 2017, and HSBC has said it intends to expand the range of working capital solutions available via the platform in 2018.