DBS partners Haier to provide digital financing to its distributors within 24 hours

DBS partners Haier, a leading Chinese electronics manufacturer, to provide digital financing to its distributors within 24 hours

• Financing facility leverages DBS’ APIs to provide distributors same-day financing via Haier’s digital supply chain platform
• DBS partners Haier partly for regional efforts to provide relief financing plans to buoy businesses amid Covid-19 crisis

To support the liquidity needs of small and medium-sized enterprises (SMEs), DBS Bank has launched a digital financing facility with Haier Group (Haier), a leading Chinese consumer electronics and home appliances enterprise, to enable its ecosystem of distributors to access lower cost financing for their purchase orders in a simple and fast manner. This forms part of Haier’s and DBS’ broader regional relief efforts to help businesses, many of which are SMEs, to stay afloat during these challenging times.

Accessible by Haier’s nationwide network of distributors via its digital supply chain platform, the integrated DBS financing facility enabled by the bank’s APIs offers distributors online financing for their purchase orders within 24 hours.

DBS partners Haier to help distributors shorten their cash conversion cycle and optimise their working capital.

John Laurens, Group Head of Global Transaction Services, DBS Bank said that providing financial sustenance to SMEs that form the commercial ecosystems of large corporates is of utmost importance in this unprecedented global trade situation. The DBS-Haier digital financing solution ensures that supply chains continue to operate in the face of disruptions.

As DBS partners Haier benefits flow both ways

“Enhancing working capital management and access to financing is critical for both large corporates and SMEs especially in the current business environment. Technology has proven to be a useful tool in this aspect. By using DBS’ APIs to create an integrated financing facility plugged into an industry anchor’s supply chain platform, the benefits flow both ways. For Haier, their sales and distribution channels are given extra support; and for its SME distributors, they enjoy an extension on payment terms, helping them with essential cash flow and working capital management needs,” added Laurens.

Yang Hongxing, Head of Supply Chain Finance, Haier Group, said, “DBS is the first foreign bank to cooperate with Haier’s digital supply chain finance business. At the early onset of the pandemic, DBS took the initiative to accelerate the implementation of digital financing lines for our distributors, to get the funds they need with as little physical interaction as possible.

“The speed at which financing can be offered to our distributors and the ease of being onboarded, have also elevated our customer experience journey to new heights. With DBS’ digital financing facility, Haier’s customers can access low-cost financing with just a few clicks of the mouse. DBS and Haier’s Supply Chain Finance team will continue to jointly promote global cooperation in Haier’s upstream and downstream supply chain finance going forward.”

As DBS partners Haierm close to 30 distributors onboarded on the fully digital financing facility targeting distributors in the first week of launch. Additional capabilities include integrated online account opening and onboarding, and facial recognition and biometric features for enhanced security.

The bank has also completed its first distributor financing request in March, where the distributor received the requested financing in under 30 minutes from the point of submission. Laurens added, “The speed of financing gives businesses a fighting chance to tide through the downturn and emerge more resilient to ride the economic upturn when it returns.”

DBS is the only non-Chinese bank appointed by Haier for this digital financing facility. The other three participating banks are China Everbright, Bank of Shanghai and MYBank.

DBS partners Haier to prove commitment in helping customers transform digitally

DBS has been steadily working with its corporate customers to digitalise their supply chain ecosystems and avail easy access to digital trade financing. Over the past year, the bank has launched several digital trade financing initiatives. in September 2019, DBS announced its first multi-tier financing facility on a logistics blockchain platform named Rong-E Lian, to help small and medium-sized enterprises (SMEs) in China get faster access to trade financing. Developed in partnership with a leading Chinese logistics player, Rong-E Lian offers multi-tier financing solutions to more than 1,000 of suppliers in the company’s supply chain ecosystem.

In February 2020, DBS said that it is advancing Singapore’s trade digitalisation agenda, by collaborating with Audi Singapore (Audi) and Audi’s local distributor, Premium Automobiles (Premium). It completed the first trade financing transaction on Singapore’s Networked Trade Platform (NTP). The inaugural trade relates to a SGD3.5 million letter of credit[2] transaction for a trade of Audi cars between Audi and Premium.

In the traditional world of trade, car importers, such as Audi, have to physically present an array of paper-based trade documents to complete a letter of credit transaction. However, by digitalising the process through the NTP, Audi and their retail partner Premium, are now able to submit bank applications, as well as send and receive trade documents online.

In turn, this enables DBS to receive and start processing the e-applications in real-time, cutting short the trade financing processing time from about a week to under one working day, yielding greater operational efficiencies for both buyer and seller. In addition, as trade documents are uploaded onto the NTP, all trade participants are able to enjoy real-time updates on the progress of their transaction, enabling them to better plan their working capital needs.

In March 2020, DBS accelerated trade digitalisation efforts with more ‘industry-firsts’ to drive greater efficiencies for customers. It completed first trade financing transaction on CamelONE Trade Finance Portal; part of bank’s broader efforts to provide enhanced support to corporates.