New York, April 22, 2022 (GLOBE NEWSWIRE) — Reportlinker.com announces the publication of the report “Global Trade Finance Market – Growth, Trends, Impact of COVID-19 and Forecasts (2022 – 2027)” – https:// www.reportlinker.com/p06271913/?utm_source=GNW
About 80-90% of global trade relies on trade finance, which includes trade credit and guarantees. Exporters and importers in less developed countries tend to pay very high fees, which increase their trading costs while traders in developed countries benefit from low interest rates and fees provided by international banks.
Lending and factoring done in the trade finance market are mostly short-term in nature. But the coverage of trade finance is not uniform. The adoption of technology in trade finance has brought about structural changes in the way trade takes place today globally. With the use of open APIs, what were traditionally closed systems are now bringing in other features to extend their offerings.
The year 2019 was marked by a mixture of instability in the macroeconomic and geopolitical landscape. The US-China trade war and Brexit have wreaked havoc on the market. An estimated loss of $420 billion in exporter revenue. In 2020, the pandemic has created a lasting impact on doing business across the world. Coupled with the scarcity of finance in general and trade finance in particular, the coronavirus is causing severe damage to developing economies. Least developed countries have been hit hard economically as borders are closed to trade and tourism. In addition, after COVID-19, the holistic approach and technology of trade finance should be the preferred option of various companies to fight against such pandemic situations in the future and to foresee the possible situations before they don’t happen.
Main market trends
Banks in the service provider segment dominate the market
Corporate banks are actively involved in commercial transactions and in recent years competitive pressures have driven them to become more efficient and offer more effective services. Trade finance is dominated by banks, with HSBC Holdings PLC, Citigroup Inc., Standard Chartered PLC, BNP Paribas SA, JPMorgan Chase & Co. and Deutsche Bank AG being among the largest providers, although the market has attracted a growing number of technologies. capital market platforms and investors in recent years. A supply chain finance program is typically set up by a business buyer with a bank or alternative finance provider to offer suppliers prepayment on their invoices. This part of the banks’ trade finance business is already experiencing a significant growth spurt: Bank of America Corp., for its part, has seen an increase of around 200% in the number of invoices financed through these programs. during the first year of the pandemic. Not only has the bank increased the number of programs it funds, but it has also expanded existing ones to cover more providers. While shutdowns and travel restrictions in 2020 have weighed heavily on the trade and those who fund it, industry revenue is on track and has reached pre-pandemic levels in 2021. In the top six month of 2021, the world’s 10 largest transaction banks saw a 6% year-over-year increase in revenue from trade finance. Banks will need to accelerate their digitization efforts and innovate in their products and operating models if they are to seize the opportunity as competition from non-traditional providers intensifies.
The United States dominates the market in the North American region
In the United States, advanced technology is playing an increasingly important role in trade finance. During the projected period, the integration of blockchain technology in trade finance is expected to generate exciting opportunities in the trade finance market. The demand for safety and security in business activities, along with a boom in trade finance adoption by SMEs, increased competition and new trade agreements, are all driving the growth of the trade finance industry in the States. -United. Multinational companies in the United States have begun to use digital technologies that promise increased supply chain efficiency and transparency, as well as the creation of new digital networks to enable commerce and finance. The growing total import and export value of the country’s international trade is driving the market.
The report includes an overview of the competition in the trade finance market along with a summary of merger and acquisition transactions that have taken place in recent times. It includes company profiles of not only banks but also a few trade finance and trade tech companies in the market. Currently, some of the major players dominating the market are listed below.
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Read the full report: https://www.reportlinker.com/p06271913/?utm_source=GNW
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