Standard Chartered and IFC Offer Trade Finance Facility
It will be used to help sustain trade flows in developing countries and narrow the gap in global trade finance.
Standard Chartered and the International Finance Corporation (IFC), a member of the World Bank Group, are partnering on a $1 billion facility to boost trade financing in emerging markets the two parties announced in a press release on Wednesday.
This arrangement will allow the two partners to equally share the risk of trade flows of a portfolio of small and medium-sized enterprises, and is expected to enable $4 billion in trade finance in Asia, the Middle East and Africa in the next three years.
Facilitating Global Trade
The announcement noted the $1.5 trillion global trade finance gap and said the facility will bring trade finance to local and regional companies, some of which are credit-constrained and rely on bank trade facilities to manage cash flows and purchase raw inputs.
Paulo de Bolle, senior director of IFC’s Financial Institutions Group called the facility a «unique partnership that can help counter de-risking trends in developing countries and support real-sector demand for trade finance.»
