The world of trade finance is moving faster than ever. So, at FITT, we wanted to talk about the ways in which technology is shaping its future, and how that will affect businesses involved in exporting and importing products and services.
To do this, we selected virtual trade finance as the topic for our latest monthly #TradeElite Twitter chat. While there are many angles and facets of this growing industry to consider, our talented and experienced group of experts guided us through this complex world.
Over the course of our hour-long chat, they broke the topic down in easy-to-understand ways, while also providing complex analysis to dig deeper into the main issues.
The conversation on virtual trade finance took place on May 5, 2016. Find out more about our expert moderator and panelists, and check out the highlights from the chat below.
Moderator:
Chris Principe (@cmpleo) lives in South Florida, and has over 25 years of experience in the trade finance industry. He currently serves as the Publisher of Financial IT magazine, and continues to hold roles with other banking and trade finance companies.
Panelists:
Haseeb Awan (@haseeb) is a Fintech entrepreneur. He is currently researching the impacts of currency fluctuations on businesses. He has also co-founded BitAccess, and splits his time between Ottawa, Islamabad and San Francisco.
JT Burke (@jtjtburke) is the VP of Business Development for China Systems US and Canada, a leading trade services solution vendor based in New York.
Enrico Camerinelli (@ecameri) lives in Italy and holds several roles, including Vice President of the CSCMP Italian Roundtable, Senior Research Analyst, Europe for Aite Group, and subject matter expert in supply chain program development for the UN Economic Commission for Europe.
Rebecca Harding (@rebeccaaharding) is the Co-Founder and CEO of Equant Analytics in Brighton, UK, a FinTech and Advisory business combining macroeconomic, geopolitical and market data with tailored analytical, risk and trading interfaces.
Ed Marsh (@edbmarsh) lives in the Boston area and is the Founder and Principal of Consulium Global Business Advisors, a management consulting company.
Dr. Michele Vincenti, CITP|FIBP (@alvana1) is President and CEO of Alvana Business Consulting Inc. in Vancouver, BC. He has many years of previous experience in trade finance, and has taught international business courses at several post-secondary institutions.
What does virtual trade mean to you?
@cmpleo Q1: Pure data terms, it’s the global money flows supporting trade. $2 tn more trade than we know about @EquantAnlaytics #TradeElite
— Rebecca Harding (@RebeccaAHarding) May 5, 2016
A1 using technology to reduce traditional barriers to trade #tradeelite
— Ed Marsh (@edbmarsh) May 5, 2016
A1. Less paper on my desk! #TradeElite
— audrey ross (@tresAudrey) May 5, 2016
What are the components needed to make trade virtual?
#TradeElite A2: Verification of the data and verification of the sender will enable participants to trust the information and act.
— NextGenTradeSCF (@JtJtburke) May 5, 2016
#TradeElite : A2 – Also a pathway for more (trusted) participants to add to and access the data flow for more efficient operations for all
— NextGenTradeSCF (@JtJtburke) May 5, 2016
@edbmarsh #TradeElite A2: possibly, but in trade today, paper=safety. So to move away from paper you need trust
— enrico camerinelli (@ecameri) May 5, 2016
What are the biggest roadblocks to achieving virtual trade?
@cmpleo @FITTNews A3: harmonisation of government/customs standards. acceptance of digital documents
— maxim berdichevsky (@MaximMGL) May 5, 2016
A3 So demand, security, trust and old ways of thinking and processes are some of the key holdup. #TradeElite
— Chris Principe (@cmpleo) May 5, 2016
Who will lead the push towards virtual trade: corporations, FinTech companies, banks or government?
#TradeElite Q4 – Corporations will drive the change. They have the most to gain by driving down the costs of trade
— NextGenTradeSCF (@JtJtburke) May 5, 2016
#TradeElite A4: The others are enablers. Important indeed, but instrumental only if corporates demand for it https://t.co/eRRYOVZ1Z2
— enrico camerinelli (@ecameri) May 5, 2016
@cmpleo @FITTNews #TradeElite : A4: Who ever makes most of the profit from. Corporations save #money and they have more #data to play with
— Michele Vincenti (@alvana1) May 5, 2016
@cmpleo A4 #TradeElite Corporates without a question through #supplychain & more flexible technology
— Rebecca Harding (@RebeccaAHarding) May 5, 2016
Why hasn’t e-invoicing become more widely used, despite the benefits?
@cmpleo Q5 cultural and regulations issues. People still trust paper more than digital & not all countries accept e invoices #TradeElite
— Haseeb Awan (@haseeb) May 5, 2016
#TradeElite A5: SMEs have less invoices to process, so e-inv= cost reduction not a big value for them https://t.co/Jzp1x5XYKh
— enrico camerinelli (@ecameri) May 5, 2016
A5. Fear of Hackers and Nigerian Princes. #TradeElite
— audrey ross (@tresAudrey) May 5, 2016
Can virtual trade help SMEs overcome obstacles to trade financing like on-boarding, compliance and risk?
@cmpleo A6 Yes #blockchain key. Disruptive within banks & through #FinTech – has potential to build trust & security at low cost #TradeElite
— Rebecca Harding (@RebeccaAHarding) May 5, 2016
#TradeElite A6 Virtual trade will mitigate, not eliminate, existing challenges for SME’s to finance using trade instruments.
— NextGenTradeSCF (@JtJtburke) May 5, 2016
What will be the big innovative changes in supply chains over the next few years?
#TradeElite A7: #blockchain, for sure https://t.co/gX7Pcl5dVD
— enrico camerinelli (@ecameri) May 5, 2016
#TradeElite A7: 2nd place: on-demand production (e.g., 3D printing) https://t.co/gX7Pcl5dVD
— enrico camerinelli (@ecameri) May 5, 2016
#TradeElite A7: 3rd place: supply chain finance= achieve results not only with physical SC operations https://t.co/gX7Pcl5dVD
— enrico camerinelli (@ecameri) May 5, 2016
@cmpleo A7 has to be #BigData to track transactions in #TradeFinance + understand defaults, yields, costs & mkt size #TradeElite
— Rebecca Harding (@RebeccaAHarding) May 5, 2016
A7 Agreed #blockchain and #bigdata, how about IOT with talking supply chains, where is it, what is it, how many is it, who is it #TradeElite
— Chris Principe (@cmpleo) May 5, 2016
Could a cryptocurrency, if implemented compliantly and correctly, become a trade currency?
A8 for sure, where/when it addresses business need #tradeelite
— Ed Marsh (@edbmarsh) May 5, 2016
#TradeElite A8 YES. with “GOOD” cryptocurr no need more for LCs, eBOLs, etc https://t.co/dIjXm8p5mo
— enrico camerinelli (@ecameri) May 5, 2016
#TradeElite Yes, you are right and look now, CitiBank has annouced CitiCoin https://t.co/iPSW0rzeBT
— Chris Principe (@cmpleo) May 5, 2016
Read the rest of the chat and follow future discussions by following the #TradeElite hashtag.
Stay tuned for the next #TradeElite chat, coming up Thursday, June 2 from 2:30-3:30PM EST.
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