How TASConnect automated Lenovo’s supply chain finance processes as a Validated Partner of the AWS Partner Network and a Qualified Software

We are a working capital solutions Software-as-a-Service platform that unlocks efficiencies and economics by enhancing scalability, visibility, and cross-border connectivity for domestic and multi-national businesses globally. In order to build an all-in-one platform connecting all supply chain ecosystem partners, we had to maintain top industry standards for data privacy and cybersecurity which was only made possible by Amazon Web Services (AWS). 

As a Validated Partner of the AWS Partner Network and a Qualified Software, we are not only powered by AWS, but also compliant with Foundational Pillars of AWS Architecture, Security, Reliability and Operational Excellence. The alliance with AWS enables us to Build, Market and Sell together by innovating, creating and delivering value to customers 

Our end-to-end financing solution built on the AWS Cloud includes: 
       ● Enhancing efficiencies and sustainability in accounts payable and accounts receivable 
       ● Enabling access to working capital sources 
       ● Automating and standardising complex workflows with your ecosystem partners 
       ● Empowering control and business intelligence over your finance programmes 

TASConnect’s universal adapter solution enables the smooth integration of multiple front and back-end systems, connecting fragmented ecosystems – anchor clients, suppliers, buyers and financiers: 
 
Enterprise buyers are able to utilise our platform’s pre-to-post shipment solutions to achieve programme scalability, enhance economic value and elevate process efficiencies in your supplier network. 
 
Enterprise sellers can improve their cashflow and expand sales growth while mitigating buyer payment risk using our accounts receivable solutions.  
 
Banks and Financial Institutions can grow their revenue, automate and create bespoke deal structures, drive ESG, and integrate easily and quickly onto TASConnect. 
 
In just under two years, TASConnect achieved a record of processing US$19 billion in financed invoices and also clinched Top 20 start up business in 2023. 
 
As seen in one of our client cases, we fully transformed and automated Lenovo’s previously manual supply chain finance processes together, empowering Lenovo’s treasury function with end-to-end visibility and control, all via one single platform: 

     ● Accounts payable financing automation to boost efficiencies and scalability  
     ● Supplier portal to empower suppliers with increased cashflow, faster collections and real-time information at invoice level  
     ● Bespoke workflow to fully integrate into Lenovo’s existing business arrangement and put control in their hands  
     ● Customised reporting, dashboards and analytics that allow treasury to make informed and optimal decisions 

Hugh Wu, Global Treasury Head of Lenovo said “TASConnect helped us transform and fully automate our previously manual supply chain finance processes. The platform is customised to integrate all our financing banks and replicate our own workflows. Our Treasury function is now empowered with end-to-end visibility and control, all via one single platform.” 
 
If you are interested to find out more about how we can empower your supply chain finance or understand more about our AWS Architecture diagram, feel free to reach out to our team here. 

ISO 20022 and trade finance: how standardised approach will reshape the industry

What is the ISO 20022 Standards?

ISO 20022 is a standard for all stakeholders in the financial services industry, which significantly reduces the complexity of sending and deciphering information in a structure data format. This methodology can be used to develop structured financial messages and API resources to help reduce the data misinterpretation and ultimately unify existing messaging standards.

The use of ISO 20022 brings enormous benefits to the financial services industry, as it improves end-to-end processing across domains and geographies that currently uses vastly different standards and information formats.

 

How does the ISO 20022 create interoperability?

While MT103 and Fedwire each uses a different standard and syntax, both provide the same information as ISO 20022. An example of how ISO 20022 create interoperability across standards is, while the MT103 Single Customer Credit Transfer 2u ISO 2u st 20 the 52a “Ordering” “DebtorAgent” element being structured differently, it is still essentially describing the same business concept, which is the financial institution that services the account of the ordering customer (or debtor). As such, both concepts can be understood and mapped to the same ISO 20022 business components when processing the data.

 

How is ISO 20022 going to re-shape Trade and Supply Chain Finance?

Today, each bank has an online application where in a corporate will upload the bespoke files containing invoices for discounting (custom format). Such files formats are not standardized and imposes heavy transformation costs, consuming both time, money and resources to translate and decipher prior to book the trade and then process the payment via the MT or MX format message.

In the trade services area, a suite of ISO 20022 messages has been developed to cover e-invoice, invoice financing, demand guarantees and standby letters of credit, as well as factoring services.

 

What is the current stage of adoption?

While there will be a co-existence period from 2022 till 2025 for handling both the MT and MX for CBPR payments, some countries are more aggressive for local RTGS to completely shift to ISO 20022. The adoption of ISO 20022 throughout the correspondent is banking do Targeted to be complete by the end of 2025, ultimately seen as the de facto standard for global cross-border payments.

This sets a strong foundation for upcoming innovations in both the payments and trade space as technology players can leverage on these standards to look at who clients transact with, when are they transacting, and how are they transacting to provide deeper insights on client behavior which helps banks make better credit decisions.

Source: ISO 2022, SWIFT 6th Limited Edition 

How to leverage platform based supply chain finance solutions

Parvez Murshed (Head of Pre-Sales & Platform Solutions, TASConnect) is a banker with more than 20 years experience, specialising in Trade Supply Chain Finance and Transaction Banking through various leadership roles within Citigroup in Asia.


Choosing Between a Single and Hybrid SCF Platforms: A Decision for Multi-National Treasurers and CFOs

Today, treasurers and CFOs of large multi-national corporations often must spend time deciding whether to provide their Supply Chain Finance (SCF) mandate to a single large bank which has its own proprietary SCF platform, or to go with a platform that can bring in funders including multiple banks and other finance providers. There is also a hybrid model where banks have tied up with outside platform providers.

The banks are facing limitations in terms of keeping up with the developments in the markets and with new technology and client requests. Most banks are not able to provide real-time Management Information Systems (MIS) and customised reports per client needs. The biggest issue facing banks today is the scarce technology dollars. There are always unlimited asks from various markets, local regulatory compliance, specific clients’ requirements and ever shrinking budget pool for tech dollars. Multiple rounds of review before they can make enhancements to their platform. platforms today are clunky and do not have client friendly interface and dashboards.

 

Overcoming Banks’ Limitations with SCF Platforms: Consolidation and Customisation

Entering the era of platforms opens a door of flexibility and customisation for the clients. A Fintech-created platform will have the flexibility to create customised workflows, dashboards and enforce client’s rule sets and provide real-time reporting back to client’s ERP.

Some banks have not yet been able to develop APIs for their SCF platforms. As a result, host to host integration is the only option and can take months to implement. Clients also do not want to connect with multiple service providers and banks. For example , if you want your supplier’s KYC done for onboarding into a SCF program, a bank may take a month while some FinTech will be able to do this in about 48 hours pulling KYC data through various sources by API calls. If a bank wants to implement an ESG solution, they have to implement their own ESG framework, get multiple levels of internal approval and then sign up with an external service provider for monitoring of the ESG performance by the suppliers. However, SCF platform is able to consolidate all such ESG capabilities in one place and launch fast in the market. Taking cross-boarder payment and FX conversion as another instance, most banks have limited capability due to the footprint restrictions, especially in illiquid and developing markets. FinTech usually has a better market coverage and local payment system capabilities by integrating with multiple platforms.

While banks bring in liquidity into the SCF programs, they also have limitations in terms of how much credit facility they can allocate. Their distribution capabilities are also limited due to competition with other banks and higher return requirements for capital, which higher calls for skim le to higher pricing for the suppliers. The time taken for distribution can be long sometimes due to scarcity of credit lines and market condition. As a result, invoices may not get discounted on time and suppliers run out of cash. This could be more acute in markets like Vietnam or Indonesia where the secondary market is nascent or non-existent.

 

The Value of TASConnect as a Single Point of Convergence for Multi-National SCF Solutions

That’s where a platform provider like TASConnect adds tremendous value to the multi-national clients by working as their extended ERP and single point of convergence to bring multiple banks, funders and service providers to one place be it for financing, supplier KYC, FX or ESG . The flexibility and nimbleness from pre-to-post shipment create transparency and visibility to clients’ end-to-end trade and supply chain ecosystems. Clients do not have to connect with all the stakeholders individually anymore, to access the holistic SCF solutions. This is the future of platforms and TASConnect is already ahead of the game by creating the future, today.

 

Leveraging on supply chain finance platforms to help corporates accelerate sustainability

Lynette Lee (member, SC Ventures) focuses on driving initiatives and start ups in Sustainability (ESG) space within the Fintech innovation industry. She advances ESG-integration standards and drives the evolution of such stewardship through spearheading collaborative ventures with industries.


The Intersection of Supply Chain Finance and Sustainability: An Evolving Global Landscape

Ever since the COVID-19 pandemic, we can clearly see the evolution of global economy being intertwined with supply chain finance and sustainability. These are topics that have grown in importance for businesses and organizations if they want to be recognized as global players who til as corporate citizens that contribute to profit, planet and people in their journey.

 

Balancing Profit and Responsibility: The Growing Importance of Sustainable Supply Chain Finance

Supply chain finance involves managing the financing and cash flow of the supply chain, while sustainability is focused on the environmental, social and economic impacts in the supply chain. The success of companies that have incorporated sustainability (ESG) in their business led to operations increased interest in the pursuit of solutions that can balance the implementations ESG solutions alongside profitable management of supply chains. Demands for sustainable supply chain finance solutions that are both profitable and socially responsible has grown. supply chain, while reducing costs and increasing profits.

Organizations need to use a variety of strategies and technologies to meet the rising demands of sustainability and supply chain finance efficiently. Technology also plays a key role in supply chain finance and sustainability. and reduce costs. Artificial intelligence helps increase efficiency and reduce waste by analyzing and optimizing supply chain data. Predictive analytics can help organizations anticipate and respond to market changes and gain cash flow mobility.

 

Assessing the Impact of Supply Chains on Environment and Society: A Structured Approach

The first step is to use certified and recognized frameworks to prioritize the crucial and critical topics that impact their businesses.
This helps with two areas:

    1. Standardize the language between finance, sustainability operations and helps in communications to regulators, investors, financiers and customers.
    2. Set the baseline for double materiality measurements

Using this identifiable structure, businesses can confidently assess and evaluate the impact of the supply chain on the environment and society. They can now deep dive into environmental impacts of the materials and processes used, as well as the social shabus impacts of labor ps practice their strategy and solutions can be implemented to reduce the impact and increase efficiency.

Undeniably, supply chain finance and sustainability are two of the most important topics in today’s business landscape. Organizations must be aware of the trends, evaluate the impact of their supply chains, and use modern technologies that covers their ecosystem to reduce costs and ensure long term sustainability.

Economic risk impact in the context of the Russia-Ukraine conflict

Hansel Quek (Chief Risk & Compliance Officer, TASConnect) held various key roles in the risk management space across the financial services industry and Big Four, where he led risk & compliance engagements, strategy and developed due diligence for mergers & acquisition of companies for different sectors.


In 2022, as US, UK and allied nations continue to ramp up sanctions on Russia, this will have an impact on the flow of goods, services and financial market activities globally. If we look at the consequences of these sanctions on financial, commodity and consumer market, the following points start to emerge.

 

Restrictions on certain Banks and transactions (including access to USD and other currencies) by excluding them from the SWIFT payment system

After much deliberation, a cohort of nations including EU, US, Canada and UK and other states agreed to ban a number of Russian banks from the Society for Worldwide Interbank Financial Telecommunications (SWIFT) international payment messaging system. If we peer in closer, seven Russian banks were removed from the global financial system but access of other Russian banks including two Russian key lenders Sberbank and Gazprombank were exempted.

The two key lenders were exempted because most of the payments linked to oil and gas were handled by them, which the EU heavily depends upon for its industrial and domestic needs.

Nevertheless, as for alternatives, Russia may reroute their transactions through China’s own Cross-border Interbank System (CIPS) and Russia’s own System for Transfer of Financial Messages (SPFS). However, they come with their own pros and cons.

Arising from this, there are some very visible effects of these sanctions in the aftermath. The complete cutoff from the global financial system means that a portion of global trade, specifically based on Russian consumption and export, will be severely affected.

Russia imports heavily from Netherlands and Germany, which will lead to an impact on the earnings of these two countries. On the other hand, the selective ban – as referenced above – keeps the EU imports of energy products (crude oil, natural gas and solid fossil fuels amongst others) from Russia in the green, for now.

 

Restrictions on Russian Central Bank and its sovereign debt

The sanctions on the Russian Central bank are mainly directed towards its ~630 USD billion in reserves. Restricting its usage means cutting off Russia’s ability to finance the ongoing invasion. It also means restricting its ability to bolster its currency, the Ruble. Indeed, since the sanctions have gone into effect, the Ruble has fallen to historic lows, almost 40% down from pre-invasion levels.

This has had widespread effects on the domestic movement of money in the country. Interest rates have been hiked to 20%. Locally, there has been a limit of 10,000 USD (in any currency) imposed on holders of Forex accounts, with any additional withdrawals in Rubles. Basically, the ability of the Russian consumers to move their assets to more stable currencies has been hamstrung entirely. Meanwhile, the Russian stock market remains closed.

Several rating agencies and banks have been revising their ratings on Russia’s creditworthiness. Fitch, JP Morgan, Moody’s, S&P and more have lowered their credit ratings and the sovereign debt outlook by several notches, calling “default” imminent. If that happens, it’ll be the first time since 1998.

 

Export controls aimed on high-tech products, technology components and parts

The US Commerce department had also imposed a set of exacting controls on technology products including military technologies and products through its Bureau of Industry and Security, thereby severely hampering Russia’s access to these technologies needed to further its military capabilities.

These are aimed at Russia’s defense, aerospace and maritime sectors which also means that the entire value chain in defense technologies has been restricted from Russian access. This includes semiconductors, computers, telecommunications, information security equipment, lasers, and sensors.

Following this, the EU, Japan, Australia, United Kingdom, Canada, and New Zealand have also announced their plans to impose similarly targeted restrictions. This is expected to block Russia’s exports of defense equipment, hinder the manufacturing base for the same and stop its military ambitions by a fair extent.

 

Restrictions of imports from Russia

A preliminary look shows that Russia is a leading exporter of oil, natural gas, wheat and metals. The US has already imposed a ban on oil, natural gas and petrochemical products from Russia, the EU and UK are set to follow.

In anticipation of the same, already strained global supply chains have been run into overdrive. Oil prices are up 60% year-to-date, wheat prices have hit record spikes of 70%, and prices of nickel and palladium have skyrocketed to historic highs.

The corresponding effects on production of plastic, steel and other co-dependent industries has been immense.

 

Freezing of visas (travel ban) and assets of corporates, banks and individuals (including cargo ships on the waters)

Sanctions on individuals, including members of Russia’s government, industry magnates and oligarch’s have been aimed at their assets including offshore bank accounts, properties around the world. Their visas have been revoked and many have been stuck at their current places.

The list extends to nearly 160 oligarchs and lawmakers, and their relatives. The ban also extended to their respective companies, thus causing many countries to actively seize, restrain and stop servicing ongoing businesses owned by these individuals.

Arising from the above, this means that exports of metals, oil and other commodities have been affected even without considering the already existing net of sanctions.

 

Airspace restriction

Airspace restrictions have gradually been added to the set of sanctions imposed. This has had two broadly defined avenues – banning Russian owned/operated aircraft in sovereign airspace (Canada, the European Union and several other European nations, including Switzerland have already put this into effect) and banning international airlines and cargo aircraft from flying in Russian/hostile airspace, thus raising risks of price spikes.

The Kremlin has retaliated with sweeping bans on all EU countries, and others such as the U.K., Canada and Switzerland.

This means that transcontinental flights are having to take longer routes and, in some cases, have cancelled them entirely. Routes from the West to Asia fly over the very same Russian airspace and have been affected the most by this. Air fuel prices and costs are likely to increase as a result, leading to the global aviation recovery taking a hit as it recovers from a Covid induced slowdown.

Along with these broad moves, there have been pullouts by several global players, including leading F&B brands, oil companies, banks, payment firms and consumer brands from Russia’s markets. As a result, the past few weeks have seen a rout in global stock market indices and investor wealth taking a significant hit.

This loss of trade, shooting prices and a hit to the movement to goods, services and cash is unprecedented. The sheer weight of these sanctions also means that the Russian economy is in shambles. Trade partnerships are being rewritten overnight, with the global supply chain facing bottlenecks of immense magnitudes.

The aftershocks of these sweeping sanctions will reverberate for a while, long after military actions have ceased.