Trading up

摘要

With corporates seeking to reduce costs and improve efficiency, banks must innovate or lose out. Several are now offering their customers powerful online versions of traditional letters of credit The trade finance indus-try is in a state of flux. In a bid to gain operating efficiencies, corporates are moving away from the practice of using letters of credit (L/Cs) and increasingly towards open account trade, particularly where they have well established trading partner relationships. Consequently, they are having to confront the issues of increased risk and access to finance. To compete against open account trading - where counterparties agree to deliver on the strength of invoices -banks are developing electronic forms of the letter of credit. BNP Paribas' award-winning innovation has taken the concept online by using the information in purchase orders to populate an electronic letter of credit, which enables corporates to issue and manage a letter of credit faster.