With a compound annual growth rate (CAGR) of 10.1%, the worldwide supply chain financing market is anticipated to increase from $5.65 billion in 2022 to $6.23 billion in 2023. At least temporarily, the Russia-Ukraine conflict hampered the possibilities of a COVID-19 pandemic-related global economic rebound. Economic sanctions on a number of nations, an increase in commodity prices, and disruptions in the supply chain as a result of the conflict between these two nations have caused inflation in the prices of products and services and had an impact on numerous markets throughout the world. At a CAGR of 9.2%, the supply chain finance market is anticipated to reach $8.86 billion in 2027.
The market for supply chain finance includes the income generated by companies that offer a range of supply chain finance services, including real-time data and analytics, reducing fraud risks, handling disputes, digitising invoice collections, automating manual processes, generating risk-free returns, invoice discounting, and collateral-free solution management.The value of associated goods sold by the service provider or incorporated into the service providing is included in the market value.
Only items and services that are exchanged between parties or sold to final customers are covered.
Supply chain finance is a group of sophisticated business tools and financing techniques that boosts efficiency and lowers costs for all parties involved in a transaction. Buyers and sellers can get a quick loan from it that maximises working capital.
The supply chain finance market’s largest region in 2022 was Asia-Pacific.During the projection period, North America is anticipated to experience the quickest growth.
Asia-Pacific, Western Europe, Eastern Europe, North America, South America, the Middle East, and Africa are the regions included in the supply chain finance study.
Export and import bills, letters of credit, performance bonds, shipping guarantees, and other instruments are the major offers in supply chain finance.In supply chain finance, export bills, such as invoices or shipping documents, serve as the supporting documentation for trade transactions, whereas import bills, presented by the buyer to facilitate payment and verify the transaction when importing goods or services, serve as evidence of the goods being imported. Export bills, such as invoices or shipping documents, serve as proof of the goods being exported.
Banks, trade finance companies, and other significant suppliers are used by both large corporations and small and medium-sized businesses in applications for local and international trade.
Future market expansion for supply chain finance is anticipated to be driven by an increase in investment in small and medium-sized businesses (SMEs).Small and medium-sized enterprises (SMEs) are organisations that fall under a certain size threshold for assets, sales, or the number of employees.
Based on the strength and volume of their trade transactions, supply chain finance enables small and medium-sized businesses (SMEs) to access larger amounts of bank credit, where these credits are available at significantly lower interest rates to help them overcome working capital challenges and improve their overall financial health. This ensures an uninterrupted flow of goods and services from their smallest suppliers to timely delivery of finished goods to their customers.For instance, the largest Italian bank Intesa Sanpaolo teamed with the European Investment Bank (EIB), a Luxembourg-based investment bank, in June 2021.
In order to address and support industrial supply chains, it committed $19.39 billion (18 billion euros) for small and medium-sized Italian enterprises. Over the course of three years, this programme would support over 50,000 SMEs, 150 major corporates, and mid-caps. As a result, the expansion of the supply chain finance market is driven by an increase in investment in SMEs for supply chain finance.
A important trend that is gaining traction in the supply chain finance market is technological innovation.In order to strengthen and maintain their market position, major companies in the supply chain financing sector are concentrating on improving their products.
For instance, IBSFINtech, an Indian provider of end-to-end digitization and automation solutions, introduced VNDZY (Vendor Management Made Easy), an AI-based SaaS platform, in March 2022.This platform covers all supply chain ecosystem challenges and delivers a connected ecosystem for businesses, suppliers, and financial institutions. It also gives a platform that is beneficial to all stakeholders.
Additionally, the technology benefits suppliers by speeding up payment processing, which improves financial discipline.
For an undisclosed sum, Clear, an Indian finance SaaS startup, purchased Xpedize in May 2022.Clear is anticipated to penetrate the SME (Small and Medium-Sized Enterprises) credit and B2B (Business-to-Business) payments market through this acquisition.
The supply chain finance platform Xpedize is established in India and provides access to immediate working cash and liquidity.
The supply chain financing market report includes information on the following nations: Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Russia, South Korea, UK, and USA.
The market value is defined as the income that businesses receive in terms of the currency (in USD unless otherwise indicated) from the sale of goods and/or services within the specified market and area through sales, grants, or contributions.
Regardless of where they are produced, the revenues for a specific geographical are consumption values, which are revenues made by businesses in the stated area inside the market. Revenues from resales along the supply chain, whether they occur later on or as a component of other items, are excluded.
The supply chain finance market research report is one of a new series of reports that offers statistics on the supply chain finance market, including the global market size of the sector, regional shares, competitors with a stake in the sector, in-depth supply chain finance market segments, market trends and opportunities, and any other information you might require to succeed in the sector. This supply chain financing market research study provides an in-depth analysis of the current and future state of the business, giving you a full view on everything you need.