Categories: B2B Payments

Report: Bank Trade Finance Revenues Set To Fall 8 Pct In 2020

As returns from cash management offers are forecasted to drop 12 percent, trade finance revenues for banks are poised to fall by 8 percent in 2020. But a somewhat fast bounce-back for transaction banking revenues is forecasted to take place next year, the Global Trade Review (GTR) reported, citing a Greenwich Associates report.

“The transaction banking industry has been in steady growth mode for the better part of a decade. In 2020, the global pandemic has brought that to a screeching halt,” the “Banking after COVID-19” report noted.

Banking revenue from international transaction services increased 2 percent compound annual growth rate (CAGR) during the last 10 years to approximately $400 billion in 2019. Transaction banking revenues are forecasted to drop by 6 percent in 2020 in contrast to last year.

However, HSBC data published by GTR indicates a rise in the count of supply chain finance (SCF) transactions in June in Asia, especially throughout Vietnam, Thailand and Indonesia.

Taulia, a SCF firm, told the outlet at a prior time in 2020 that early payment volumes throughout its platform rose in excess of 200 percent in March on a month-on-month basis.

In August, news surfaced that Dignari Capital agreed to offer $50 million to Sheng Ye (SY) Capital in a strategic deal to look into novel supply chain finance choices for small- to medium-sized businesses (SMBs).

"We are very optimistic about the supply chain financing industry and see substantial financing needs in China's underserved [SMB] sector," Dignari Capital Founding Partner Grace Tan said in a past press release. “SY Capital is able to provide flexible and efficient financial services to upstream [SMB] suppliers and at the same time maintain a good risk control record with a zero non-performing loan ratio.”

Dignari Capital’s investment will work to grow access to various funding channels.

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The How We Shop Report, a PYMNTS collaboration with PayPal, aims to understand how consumers of all ages and incomes are shifting to shopping and paying online in the midst of the COVID-19 pandemic. Our research builds on a series of studies conducted since March, surveying more than 16,000 consumers on how their shopping habits and payments preferences are changing as the crisis continues. This report focuses on our latest survey of 2,163 respondents and examines how their increased appetite for online commerce and digital touchless methods, such as QR codes, contactless cards and digital wallets, is poised to shape the post-pandemic economy.