Emerging market (EM) manufacturers were facing difficulties even before the coronavirus pandemic decimated international demand for many of their products.
The Asian Development Bank estimated that $1.5 trillion of requested trade finance was rejected last year – a figure that could rise to $2.5 trillion by 2025, according to the World Economic Forum (WEF).
In mid-May, Stenn closed a new $200 million financing facility to provide liquidity and cash-flow management to global companies affected by the coronavirus pandemic. Then in the first week of June, the company announced that a new round of funding had boosted its core trade financing programme to half a billion dollars.
Stenn hopes these funds will help it capitalize on the increased acceptance of non-bank trade finance, as indicated from a survey it conducted with more than 700 medium-large sized businesses in the UK, US and China at the end of last year.
More than 80% of respondents said they were considering switching to alternative finance providers from traditional banks for trade finance in 2020, with Chinese businesses particularly keen to explore their non-bank options.
