Olea Global, Vayana in pact for cross-border trade finance

Singapore-based Olea Global Pte, a digitized supply chain platform, on Thursday announced a partnership with Vayana Network to offer cross-border trade finance solutions in India. Olea Global is a joint venture between Standard Chartered and Linklogis. Olea links supply chain financing with a pool of global investors interested in trade finance. Olea would be bringing its structuring capability, technology platform and access to funding from alternative global investors. Linklogis is a supply chain technology solutions provider in China with a 20% market share and $ 20-billion annual throughput. It is the largest receivables asset originator in China and is backed by investors GIC, BlackRock, Sequoia and Tencent.

Vayana Network is India’s largest trade finance platform, and would leverage its close relationships with corporates to provide financing solutions. Vayana has processed two million transactions and enabled finance of over $ 10 billion to over 1.5 lakh MSMEs. Vayana has also received an in-principle approval to set up the International Trade Finance Services platform at GIFT City, Gujarat.

Vayana and Olea would together provide exporters and importers in India with timely access to alternative liquidity at affordable rates. The platform is expected to go live in June. The partnership will initially focus on making export finance readily available for small and mid-sized exporters. The combined goal was to reach $ 1 billion in financing on the platform in the first year of the partnership, Vinod Parmar, global head – sales and marketing, Vayana Network, said.

Letitia Chau, deputy CEO of Olea, said they would be bringing in a fresh pool of international capital into the trade and supply chain finance market in India, specifically for small and medium-sized businesses. These would be hedge funds, other funds, banks and investors who have an appetite to invest, Chau said. Olea would bring its reach and understanding of the markets in the US and Europe,

Vietnam, Indonesia, the Philippines and other South-East Asian markets to the platform. Traditional lenders also had lengthy and opaque documentation processes which made it hard to access this capital, Parmar said. They would be looking at facilitating finance without guarantees or letters of credit and at around 8-9% instead of 14-18% MSMEs are currently paying, he said.

Ram Iyer, founder and CEO of Vayana, said the partnership with Olea complemented their vision of connecting the smallest of businesses with the largest of lenders. Combined with the International Trade Finance Services platform and other cross-border offerings, they would be looking at providing a wide array of trade finance solutions to MSME businesses, Iyer said.

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