The Trade Finance Gap in Frontier Markets

Frontier markets are countries that are at an early stage of economic development and have limited access to financial services.

This includes many countries in Africa, Asia, and Latin America.

One of the biggest challenges facing businesses in frontier markets is the trade finance gap.

The trade finance gap is the difference between the amount of trade finance that businesses need and the amount that is available to them.

According to the Asian Development Bank, the global trade finance gap is estimated to be $2.5 trillion. This gap is particularly large in frontier markets, where businesses often lack the collateral and credit history required to obtain traditional trade finance products.

The trade finance gap has a number of negative consequences for businesses in frontier markets. It can make it difficult for them to import and export goods, expand their operations, and create jobs.

How Financely is Bridging the Trade Finance Gap

Financely is a FinTech startup that is using innovative solutions to bridge the trade finance gap in frontier markets. Financely provides a variety of trade finance products to businesses in frontier markets, including:

• Trade finance loans: Financely provides trade finance loans to businesses in frontier markets that do not have access to traditional trade finance products. Financely uses a variety of data sources, including social media data, to assess a business's creditworthiness.

• Invoice financing: Financely provides invoice financing to businesses in frontier markets that need to finance their accounts receivable. Invoice financing allows businesses to get paid for their invoices immediately, without having to wait for their customers to pay.

• Supply chain financing: Financely provides supply chain financing to businesses in frontier markets that need to finance their supply chains. Supply chain financing allows businesses to get the financing they need to purchase inventory and raw materials, even if they have not yet been paid by their customers.

• RCF: Revolving credit facilities provide businesses with a flexible line of credit that can be used to finance their working capital needs. This can be a valuable tool for businesses in frontier markets, which often have unpredictable cash flow cycles.

• Structured Trade Finance Funds: Structured trade finance funds are investment funds that invest in trade finance transactions. These funds can provide businesses in frontier markets with access to the financing they need to grow their businesses, even if they do not have the collateral or credit history required to obtain traditional trade finance products.

Financely's Innovative FinTech Solutions

Financely is using a number of innovative FinTech solutions to bridge the trade finance gap in frontier markets. For example, Financely is using:

• A web app where clients can directly apply for trade finance. This makes it easy and convenient for our clients to get the financing they need, without having to go through a long and complex process.
• A distribution list where we match our clients with investors and funders. We have over 3,000 members on this list, including at least 50 banks, funds, and 100 funds looking for exposure to trade finance. This gives our clients a wide range of potential financing partners to choose from.
• Insurers on board to provide trade credit insurance and other risk mitigation products. This helps our clients to protect themselves against the risks associated with trade finance transactions.
• Structuring services to help our clients structure their deals in a way that secures the interests of all involved parties. This is especially important for complex trade finance transactions.
• SPVs to facilitate trade finance transactions. SPVs can be used to isolate the risks associated with trade finance transactions and make them more attractive to investors.

We are committed to providing our clients with the best possible service. Our team of experienced professionals has a deep understanding of the trade finance landscape and is able to help our clients get the financing they need to grow their businesses.

Here is an example of how we helped one of our clients:

A small business in Nigeria that imports and exports textiles was struggling to get access to trade finance. The business did not have the collateral or credit history required to obtain traditional trade finance products.

We helped the business to structure a trade finance transaction that was attractive to investors. We also introduced the business to a group of investors who were interested in financing trade finance transactions in Nigeria.

The business was able to obtain the financing it needed to import and export textiles more efficiently. The business was also able to expand its operations and create new jobs in Nigeria.

We are proud to be helping businesses in frontier markets to access the trade finance they need to grow. We believe that trade finance is essential for economic growth and development in these markets.

Impact of Financely's Work

Financely's work is having a positive impact on businesses in frontier markets.
We are helping to increase awareness among institutional investors about the opportunities in frontier markets, such as Africa.

We are doing this by:

• Organizing field trips to places like Lagos and Nairobi for institutional investors to visit our clients and see on the ground how the activities are flourishing. This helps to dispel the myths about frontier markets being too risky and shows investors the real potential of these markets.
• Highlighting the funding gap in key sectors such as energy, transportation, and trade. We educate investors about the high demand for funding in these sectors, which is not being met by traditional financial institutions. This helps investors to see the opportunity to invest in frontier markets and make a positive impact while also generating attractive returns.
• Working with local entrepreneurs to help them obtain funding from institutional investors. We help entrepreneurs to prepare their businesses for investment and connect them with investors who are interested in investing in frontier markets.

While increasing awareness among institutional investors, Financely is helping to close the funding gap in frontier markets and allowing local entrepreneurs to access the capital they need to grow their businesses and create jobs.

This is having a positive impact on the economies of frontier markets and contributing to sustainable development.

Quote from Elena Martinez, Director of Trade Finance at Financely:

"The trade finance gap in frontier markets is a major obstacle to economic growth. Financely is using innovative FinTech solutions to bridge this gap and help businesses in frontier markets access the trade finance they need to grow.

We believe that by making trade finance more accessible and affordable, we can help to create a more prosperous and equitable world."

The trade finance gap in frontier markets is a major obstacle to economic growth. Financely is a FinTech startup that is using innovative solutions to bridge this gap and help businesses in frontier markets access the trade finance they need to grow.

Financely's work is having a positive impact on businesses in frontier markets, helping them to increase their sales, create new jobs, and expand their operations.