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CMA CGM wants to give shippers a cash-flow boost with its new range of import and export financing solutions, a new sign carriers are expanding beyond core shipping services.
The French carrier has partnered with Singapore-based fin-tech player Incomlend to launch Shipfin Trade Finance, which it claims will accelerate its strategy of “customer-centricity”.
Mathieu Friedberg, CMA CGM senior vice president for commercial agencies network, said: “We draw on our more than 40 years’ experience at the heart of international trade to offer innovative, simple and relevant solutions beyond shipping to support our customers’ international development.”
The carrier said Shipfin allowed importers to use supply chain financing to free working capital while stabilising their supplier relations; for example, by extending payment deadlines to 120 days.
Similarly, exporters can apply for cargo financing, which maintains their cash positions by receiving payment as soon as goods are loaded for up to 90% of the value of the invoice.
Shipfin will be available to CMA CGM, ANL, APL and CNC customers based in India, Dubai, Singapore, Hong Kong, Malaysia, Indonesia and the Philippines, before it is gradually rolled out to other countries.
CMA CGM is not the first carrier to offer supply chain financing, however.
Maersk Trade Finance launched in India in 2015 and was subsequently expanded to include the UAE, Singapore, Spain, the Netherlands and some US states, according to Shipping Watch. Maersk said in April it was targeting $500m in global trade finance disbursement this year.
Trade finance is also provided by many global forwarders, as is cargo insurance, and here too carriers are moving further into the traditional forwarding space, with Hapag-Lloyd announcing an online insurance product last month.
Whether provided by carriers or forwarders, trade finance appears to be one area where blockchain can be successfully utilised in the logistics industry. For example, start-up dltledgers announced in July it had processed $1bn in trade finance deals within its first 18 months, and the now widely supported TradeLens project is also said to be targeting financial services.
According to Incomlend, there are some 1.26bn freight invoices issued, verified, paid, and reconciled every year.
Founded in 2016, Incomlend claims to be one of the first cross-border trade finance platforms in the world, with over 2,000 trade deals processed in more than 50 countries. As an alternative lender, it provides digital invoice finance services through a marketplace funding model.
It said its partnership with CMA CGM would enable the carrier’s clients to digitally register and undergo an automated due diligence process, trade through finance applications, monitor finance activity through dynamic dashboards and manage their cash online.
Dimitri Kouchnirenko, Incomlend director and co-founder, added: “This deal is a great fit as CMA CGM can perfectly identify cash flow needs among its shipping clients, while Incomlend is geared to globally provide funding and process international transactions.
“This partnership will further increase financial inclusion for trading SMEs on a global level.”