Joint ventures with e-invoicing networks LiquidX differentiates itself from players who previously lacked that access. In are a priority for another SCF platform like Prime Revenue as the latter – like addition, almost none provide any fun- – Orbian. In February this year it the other traditional platforms – focuses damental alternative to the underlying announced a partnership with Tungsten more on providing a technology solution infrastructure upon which the financial Networks, which has 251,000 suppliers to the process problems that prevent system rests. Peer-to-peer models do so, using its AP/AR solutions. Tungsten companies from accessing vanilla bank but are unreliable and small. Larger gains the ability to offer SCF to its net- receivables financing, rather than creat- players, like Apple and Google may be work; Orbian gains access to the volume ing pools of new liquidity and a true mar- in a position to create entirely new of customers and financeable invoices it ketplace for trade finance assets. systems, but these would inevitably be needs to expand. regulated as heavily as their traditional Munich-based CRX-Markets also has peers, so the benefits of using them The overall market is certainly growing. an auction platform, though one that is would be uncertain. Prime Revenue, another leading plat- designed to generate securitised cash- form, had a record-breaking 2016. Its flows that can be sold as notes to fixed- For now, FinTech is largely a wait and 20,000-plus customers in over 70 coun- income investors, rather than as a see game for corporate treasury, with tries processed more than $100 billion in primary market for the underlying assets the most relevant action happening at supply chain financing (SCF) transac- themselves. And C2FO operates another the banks. There, both developments tions using the company’s proprietary variant in which companies with excess such as Ripple and SWIFT GPI, as platform. In addition, 3,500 new clients cash can set their desired rates of return well as consolidations like D+H/Misys, were added to the platform. on the cash they wish to make available promise increased efficiency and lower cost within the parameters of the con- ventional financial system. Larger players, like Apple and Google may be in a position to create entirely new systems, but these would inevitably be regulated as heavily as their traditional peers. When it comes to FinTech, treasury is These ‘traditional’ players are compet- and the market will fill those orders with already some way up the learning curve. ing with other marketplaces for receiva- requests from suppliers that need cash In a recent EuroFinance poll of 250 bles and confirmed payables. One of and which have posted the early payment companies, asked, “are you using any these is LiquidX whose Managing Direc- discount they are prepared to accept. payment services provided by financial tor, Glenn Kocher, has described it as The C2FO marketplace matches these technology companies?”, 36.3% said aiming to be “the Amazon or ebay model orders in real time – achieving the best yes. And of the 63.7% who said no, for working capital and trade finance.” rate of return for the companies with 64.8% said that they would consider LiquidX is an auction platform that lists doing so in the future. cash and the best rates for the companies the true sales accounts receivables, sup- that need cash. These responses suggest that treasurers ply chain finance programmes and con- are adopting the simpler and more firmed payables assets of only large cap, A bewildering choice mature SaaS and Cloud offerings, and usually publicly traded, MNCs. These waiting to see which companies emerge sellers gain access to asset buyers outside The biggest problem for anyone looking from the swarm of new start-ups with a their supply chain programme or core at FinTechs today is simply the number resilient and scaleable technology and bank group, including other global and of companies. It is a given that most will business model before committing. In regional banks, hedge funds and institu- either fail or consolidate and right now the words of one of the more cautious tional investors. The platform has exe- are too small to be serious choices for treasuries: “I don’t dismiss anything but cuted over $13.4 billion of trade volume corporates of any size. Most are also we don’t know who those companies are and processed over $48 billion in post simply service layers offering better and we are not going to be the first ones trade settlement to date. wholesale pricing or services to people to use them.” 28 // TREASURY PERSPECTIVES 2017/2018 www.eurofinance.com