Global Banks Weather the Interest Rate Storm
When it comes to trade finance, more than half of the world’s banks (55%) are feeling the sting of rising interest rates. Even 44% say geopolitical jitters are putting a damper on growth.
What Banks Are Doing About It
- 52% are charting a new course in 2024 by launching fresh product lines (up from 41% last year).
- 27% now see Trade Receivables as the next big thing, finally overtaking Payables for the first time since the survey began.
Optimism Persists
Despite the rough seas, a majority of banks are still hopeful:
- 81% of surveyed banks expect their supply‑chain finance assets to grow in the next year.
- More than a third (35%) predict increases in asset sizes of over 10%.
Why Receivables Are the Hot Ticket
Matt Wreford from Demica notes that while high rates may have hurt Payables, the market is still hungry for receivables—they’re cheaper, more flexible, and fit what now‑day companies need.
“Non‑documentary trade finance remains a reliable tool for corporate funding even when rates climb. It’s all about flexibility and a mix of products,” Wreford added.
Takeaway
In a volatile world, banks see the long‑term upside of trade receivables and are ready to pivot. The trend suggests more asset growth in the next year, with banks poised to meet every corporate financing need—no matter how turbulent the waters.
