The Standard Chartered Banking group has announced a strategic agreement with Infor. The agreement will see the bank introduce the Infor Nexus network to its clients. Founded in Asia, Standard Chartered is in the FTSE 100 and is also listed on the Hong Kong, Bombay and National Stock Exchange in India. It operates in more than 60 markets with 1,026 branches across the world. Through this agreement it hopes to bring supply chain liquidity and reduced supply chain risk to its customers.
Infor Nexus is a supply chain orchestration platform. It provides supply chain visibility and is increasingly integrating financial institutions into the network. There are already 65,000 companies on the network from large multinationals to SME’s. The platform manages more than $1 Trillion in trade and has over $50 billion of payments processed on the platform to date. This agreement should help to accelerate the growth of both.
Michael Sugirin, Global Head of Open Account Trade Product Management, Standard Chartered, said: “While large corporates have achieved some level of automation through sophisticated enterprise resource planning systems, around 80 percent of data used in matching are sourced from documents residing with external parties.
“This manual matching process is time-consuming, often resulting in a delay of the trade financing cycle which impacts the supplier’s ability to meet their working capital needs, most of whom tend to be small and medium-sized businesses. This strategic partnership addresses this gap and reduces capital related costs and risk from the supply chain.”
What difference will this make
The agreement will see Standard Chartered suggest to clients that they join the Infor Nexus network. There are advantages for all concerned. New businesses will extend the reach of the Infor Nexus network. Larger companies can benefit from a validated supply chain network, providing more supplier options. For smaller companies it provides an automated and secure platform offering financial services. For Standard Chartered it will allow them to provide additional services and reduce risk.
The benefits include:
- Risk mitigation with enhanced data analytics.
- Digitising its clients’ supply chains through advanced document management tools.
- Improve client relationships with the ability to meet increasingly complex requirements in an automated and efficient way.
- Provide customised financial services for specific buyer and supplier ecosystems. Not just for existing clients but other companies on the Infor Nexus platform.
- Increase revenue opportunities by increasing days of funding, and financing shorter-term maturities that would not be possible with paper-based processes.
Infor Nexus provides on-boarding processes for organisations. Those organisations do not need any existing supply chain agreements in place with another company on the network. Therefore, for clients, once validated it opens up the possibility of new customers and suppliers.
Michael Sugirin added: “As our client’s trusted banking partner, our goal is to support them in their digitalisation journey through expediting their payables acceptance and facilitating export proceeds, and as a result improve their working capital cycles.
“We are excited to have this introduction agreement in place with Infor, whose platform offering not only fits well with our emerging markets footprint which generates significant trade documents flows, but also shares a similar commitment in supporting the development of sustainable, intelligent supply chains.”
Enterprise Times: What does this mean
This is a significant announcement for Infor and it opens up the possibility of more such agreements with other financial institutions as they look to replicate what Standard Chartered is doing. This is not the first partnership with a financial institution though. In 2017 Infor GTNexus announced an arrangement with HSBC.
Rod Johnson, General Manager and Head of Americas at Infor, commented: “Invoice approvals in a traditional non-automated environment often take weeks to complete, putting a squeeze on suppliers and bringing contention to the buyer-supplier relationship. Slow invoice matching delays the trade financing cycle, preventing suppliers from obtaining capital they need to deliver quality and compliant goods on time.”
This should help to rapidly grow the footprint of Infor Nexus in 2020. There are some interesting possibilities that could come from this announcement.
How many connected organisation can Infor Nexus add by the end of 2020? Also what new financial services Standard Chartered will bring to the network? How attractive will these services be to organisations, both current customers and other organisations?
If it can demonstrate an increase in revenues, other institutions are likely to follow them.