Best transaction bank for supply chain finance 2018
Bank of Communications
Shanghai-based Bank of Communications adopted an up- and downstream approach to its supply chain financing strategy back in 2005, and has seen business balloon from 3,000 enterprises to a client base of more than 30,000 that includes many of the customers, vendors and subcontractors of the original 3,000.
To illustrate this, the bank cites the example of two firms from the automobile sector: Liaoning-based First Auto Group; and Hubei-based auto-manufacturer, Dongfeng Automobile. Initially, the bank served just First Auto and Dongfeng, but over the years also picked up many of their clients and suppliers.
The bank found that auto companies needed help to push sales, so it offered its services first to them, then to their suppliers, subsidiaries, affiliates and finally to their dealerships.
The bank then expanded this approach to clients in other industrial sectors, especially home appliances manufacturers such as Midea Group and Gree Appliances.
The bank even developed smartphone apps for enterprise clients, and in recent years has developed blockchain technology for payment services.
The bank celebrates its 110th birthday this year, and there is no question it certainly has come a long way from its early days. Founded in 1908 by the government of China’s last imperial government, the Qing Dynasty, the bank started out by selling bonds to finance the government’s purchase of foreign-built railroads in China, which at the time were at the leading edge of technology.
For its dedication to continuous innovation through the ages and its more recent development of smart application technology in up- and downstream supply chain finance, the bank deserves to be named the best transaction bank for supply chain finance.