Global Head of Structuring Francois Terrade talks about his key takeaways from the Association of French Corporate Treasurers’ (AFTE) Fintech conference.
Earlier this month, I had the pleasure of speaking at the AFTE‘s annual fintech conference . The event brought together leading trade finance fintechs as well as ITFA (International Trade & Forfaiting Association ). Up for discussion: the latest innovations in financial technology, and what Treasurers should be doing to make the most of them.
Discussions amongst the attendees highlighted a number of prominent trends:
- Trade finance is now innovating fast. Innovation in trade finance technology has long been hampered by the complexity of processes, and legal and regulatory requirements. Times are changing and a number of fintechs are working to generate significant productivity gains. They are supported by the actions of trade associations such as ITFA who have promoted digital negotiable instruments, supported by proven and reliable technology. This will increase access to trade finance and make the market more efficient and secure.
- The world of fintech services is complex for a Corporate Treasurer. Fintechs operate across all areas of trade finance: payment services, document digitalisation, fraud prevention, bills of lading registry, credit insurance, LCs / guarantee platforms, risk distribution, data analytics and integrated platforms. Corporate treasurers therefore need consistent industry terminology, clear guidance and the initiative of trade associations such as AFTE. Likewise, organisations which can map the fintech landscape, such as OpenBanq, can help bring clarity.
- Fintechs play in an eco-system. Some brand themselves as disrupters (often a necessary stance from a technological standpoint), others favour a more collaborative approach. It is however clear that they cannot work in isolation and often rely on collaboration with banks, credit insurance companies, other fintechs or investors to provide the sort of services corporates need.
- Fintechs can solve a variety of challenges for a corporate. Some focus on enhancing a specific set of services to increase efficiencies (for example digitalisation of documents), others bundle services together so efficiency gains are achieved through seamless processes (such as marketplaces and platforms). The treasurer needs to understand their business’ priorities before choosing who to partner with.
- The SaaS model is driving investment. In the contest between buy and build, fintechs have deployed levels of investment in technology that goes far beyond what established market players such as banks can develop by themselves. Beyond investment, fintechs’s DNA is innovation.
As a conclusion, it is a great time for discerning Treasurers. Trade finance technology is now moving fast.
Francois Terrade joined Demica in November 2015. With more than 20 years of experience with Société Générale CIB and GE Capital in cross-border receivables financing, Francois helps corporates and private equity funds across Europe secure working capital solutions in France and in Europe by way of securitisation, factoring or asset-based financing in order to meet their strategic objectives.