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Fintech collaborations focus on fixing pandemic-struck supply chains

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The coronavirus dealt a double blow to procurement, cutting off both goods and money. Banks and e-commerce firms are relying on partnerships to tweak payment tools to rescue the market.

In the past few days, MSTS and Alibaba have collaborated to embed trade financing on a cross-border e-commerce site; while BNP Paribas entered a deal with Coupa to offer a virtual card to improve visibility for supply chain billing and payments.

“MSTS allows Alibaba to have similar capabilities to Amazon,” Bonde said.

These deployments reveal more attention on B2B payments than in the past, placing supply chain transactions on par with consumer payments innovation after years of lagging behind.

MSTS’ clients, the sellers, offer 30 or 60 day terms to buyers. Alibaba provides an international supplier network, B2B payments via its e-commerce platform and ancillary merchant services such as digital trade shows.

This has given Alibaba the ability to manage currency exchange, one of the factors that can complicate international supply chains. It’s a major point of competition among fintech firms, particularly those that use blockchain technology to eliminate the third parties that slow cross-border payments and extract fees for managing currency conversion.

Alibaba has moved into supply chain payments for businesses more recently. A 2019 deal with Office Depot provided Alibaba access to 10 million business customers while providing U.S. small businesses access to more than 150,000 suppliers in Alibaba’s global network.

International suppliers usually require more than half of a payment up front, exposing the buyer to working capital shortfalls, said Brandon Spear, president of MSTS.

Read the full article on PaymentSource.

Originally sourced by PaymentSource By John Adams June 11, 2020, 12:01 a.m. EDT

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