Banks and collateral managers are using Binkabi solution to streamline inventory finance.
Set up collateral projects by inviting relevant parties such as commodity exporters, banks, collateral managers. Allocate roles segregating between initiator (e.g. commodity trader), approval of transaction (e.g. lender) and executor of inventory movement (e.g. collateral managers). No more going to a branch, pushing papers, emails, phone calls - all is coordinated through a single interface. All parties have instant access to live inventory positions on the blockchain.
Inventory loan can be taken directly from the project dashboard based on approved facility. Any movements such as disbursement or repayment of loan or underlying collateral such as sales or commodity price fluctuations will affect collateral ratio which in turns will trigger loan management actions automatically.
Sync financial and information flows with physical flow of inventory/commodities through power of blockchain technology.
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Raise a stand-alone invoice or an invoice automatically generated as a result of a sale of inventory. If Buyer has not been on boarded to Binkabi platform, no problem - Our platform will automatically send them an email guiding them through an easy on-boarding process.
Pay Now: Buyer could pay for the invoice directly on the platform. They first need to create and top up the Binkabi Wallet.
Pay Later: Buyer accepts the invoice but choose to pay later. Once the invoice is accepted it will be tokenized. Selected invoices under supply chain programs can be used as collateral for invoice financing or sold to a bank/investor at a discount in exchange for access to cash. Binkabi platform coordinates the entire tokenisation of invoice to invoice financing and invoice marketplace.
Supply chain program
If inventory and invoice finance can be separate solutions in their own right supply chain finance solutions combine both.
Supply chain program typically set up by a lender/bank who invites their corporate client and other service providers such as collateral manager to the program. The corporate client will then on-board their suppliers and buyers simply by adding their emails to the program dashboard.
When suppliers supply commodities, corporate accept the invoice and pay later. The invoice is then tokenised and used as collateral for the supplier to access funding from the lender. As the lender has a recourse to the Corporate who has better credit rating than a typical supplier, lender can be much more competitive in lending terms. This is the essence of supply chain finance or reverse factoring.
Alternative, corporate can borrow from lender on the back to their inventory or their own invoices (to their buyers). With this funding, corporate can then settle supplier invoice in full early or even extend credit to suppliers based on accepted purchase orders.
All these help corporate secure the supply chain to ensure they have raw materials for processing. Supplier can access finance at competitive rates. Banks can lend securely and profitably. It is simply Win-Win-Win
Inputs financing program
Farmers in emerging markets particularly in Africa typically suffer from low-yield production. This is due to lack of basic inputs such as good seeds, fertilisers and crop protection, irrigation (through small pumps) or mechanisation (e.g. for land preparation or harvest). Despite advances in agriculture technologies farmers often do not benefit from them due to lack of financing.
Inputs financing programs provide loan in kinds to farmers. However, lenders are not typically set up to lend small amounts to individual farmers. The cost to serve is simply too high. Simply booking, disbursing, monitoring and collecting individual loans prove too high administrative costs for banks let alone having to deal with risk of loan loss.
Binkabi's inputs financing solution enables the issuance of inputs voucher on the blockchain to a batch of farmers. Working with extension agents, farmers can then claim these inputs vouchers (simply by scanning a QR code on a mobile device) for actual inputs from Inputs Providers. Inputs Providers will then claim the loan disbursement from the bank on the back of spent inputs vouchers. During the production process, Extension workers can help monitor the product. At harvest the produce is secured and transported to an accredited warehouse under the program where an Off-taker would buy the outputs. At that point the inputs loan are extinguished and remaining proceeds paid to farmers.
All these are coordinated through Binkabi platform making it an end-to-end farming to processing supply chain solution.