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Banking & Finance

HSBC Vietnam introduces supply chain finance

Released at: 14:37, 27/08/2019

HSBC Vietnam introduces supply chain finance

Photo: HSBC Vietnam

Web-based interface ensures buyers' efficient, swift, convenient, and secure payment to suppliers.

by Ngoc Lan

HSBC Vietnam has successfully deployed supply chain finance on a web-based platform for a company in Vietnam, following its successful implementation in France, Canada, Australia, the UAE, Singapore, Thailand, South Korea, and Malaysia.

HSBC Supply Chain Finance (HSCF) is a web-based interface that ensures buyers’ efficient, swift, convenient, and secure payment to suppliers. The platform currently supports over 20 languages such as English, French, Japanese, Chinese, Italian, German, and Vietnamese in the local market.

Upon receiving goods and invoices from suppliers, buyers can easily upload the invoice file onto the HSCF platform, then approve the invoices in the system. Subsequently, the buyers’ bank (HSBC) will make early payments to suppliers. This supply chain finance helps optimize working capital, reduce supply chain costs, and enhances the buyer/supplier relationship.

The e-solution will help save time, enhance transparency, reduce manual errors, and provide quick and timely updates for all parties.

For buyers, the supply chain finance supports them in optimizing payment terms negotiated and agreed to with sellers, increasing liquidity and boosting payment efficiency, resulting in supply chain cost reductions. By injecting liquidity into the supply chain, they can extend supplier networks and enhance strategic supplier relationships.

Furthermore, HSCF’s user-friendly interface allows buyers to upload an unlimited number of invoices with a single click. It can also provide accurate forecasts on future cash flow by extracting and analyzing data in various formats, supporting the business’s reporting process.

The suppliers that buyers choose to join HSCF will receive early payments based on buyers’ credit ratings, resulting in competitive capital cost benefits. With this program, suppliers can effectively decrease Days Sales Outstanding (DSO) and enjoy additional increased working capital without leveraging bank credit lines. It also minimizes collection, cash management, and insurance costs.

With HSCF, they can request early payment for invoices based on business cycle demand, from there optimizing cash flow management. Payment risks from suppliers’ accounts receivables are minimized as suppliers receive early payments when joining the program. Suppliers do not need to be HSBC customers or maintain accounts with the bank.

Suppliers and buyers will also receive professional technical and transactional support from HSBC’s dedicated client service team.

Mr. Ajay Sharma, Head of Global Trade and Receivables Finance, HSBC Asia Pacific, said the launch of HSCF on an e-platform is testament to HSBC’s commitment to transform trade for clients in Vietnam as well as the rest of Asia. “This is the latest innovation we have rolled out to enhance the customer experience and provide them with easy access to working capital,” he added. “As a world-leading trade bank, we have both the opportunity and the responsibility to help reduce trade friction, make trade more accessible, and further drive growth in the exchange of goods and services.”

The HSCF platform is the next step in HSBC Vietnam’s trade digitalization strategy. Since 2018, the bank has rolled out various solutions, such as Trade Tracker (a digital application to support customers in real-time tracking of trade transactions) and executed the first live pilot blockchain Letter-of-Credit transaction.

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