In a momentous year for the industry, the top tier of trade finance banks remained remarkably stable in this year’s Trade Finance Survey. Supply chain disruption will continue to bedevil the sector and liquidity provision together with digital innovation will place sizeable demands on trade finance banks in 2022.

Corporates want to improve sustainability in their supply chains, but, if anything, the barriers to doing so are getting worse.

Global supply-chain bottlenecks have profound implications for how and where companies will fund their operations in the future. As the lines of ships lengthen outside ports, there’s a macroeconomic cost for banks weighing on loan demand and perhaps asset quality. However, some trade and logistics financing businesses that were previously on the margins of banking are now seizing their moment.

Banks are taking a more proactive approach to sustainable trade finance, recognizing that their responsibilities extend beyond simply providing financially competitive products.

If the market for sustainable finance is ever to achieve true scale, it needs to crack the tough nut of sustainable trade finance solutions.

Previously known as reverse factoring, sustainable supply-chain finance is one of the products currently generating the most interest among both banks and their corporate clients.

Buoyed by relatively healthy balance sheets, corporates have demonstrated a willingness to directly support the financial health of their supply chains since the start of the coronavirus pandemic.

Customers are starting to embrace digital forwarders that provide supply chain finance services as well as digitized freight forwarding.

Supply chain finance management is more than just about extending favourable payment terms – corporates now need their banks to be involved all along the chain to keep their suppliers operating.