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Olea's Journey: Bridging $1.7 Trillion Global Trade Gaps with Blockchain, AI, and Key Partnerships
Finding the best ways to implement supplier-to-investor supply chain and global trade through next-generation innovative technology, Olea has become an accelerating venture for the Asian trading industry.
Olea is a joint venture that was formed in 2021 with Standard Chartered, a banking group in Singapore, and Linklogis, a supply chain finance technology provider based in China by Amelia Ng, the CEO of Standard Chartered, and Letitia Chau, the Deputy CEO.
Having joint partnerships with Vietnam, India’s Vayana and YES BANK, and Silver Birch Finance in England, Olea has increased its venture value and widened its platform for potential investors across the world. In this article, all the key milestones will be discussed that Olea has advanced through and guide you through the insights that led to Olea success.
Trade Finance in Global Business and the Power of Blockchain
First, what is trade finance?
Trade finance includes various financial products that help companies buy and sell goods internationally. It involves third parties, usually banks, to manage and reduce risks in international trade.
Key Tools in Trade Finance:
- Factoring: Allows companies to receive immediate payment based on their receivables (money owed to them).
- Export Credit: Loans or credit provided to exporters to help them fulfill orders.
- Insurance: Protects against risks like non-payment or delivery issues.
Benefits of Trade Finance:
- Reducing Risks: Ensures that sellers get paid and buyers receive their goods, building trust between trading partners.
- Improving Cash Flow: Helps companies manage their money better, with tools like factoring providing immediate payment.
- Increasing Business Opportunities: Enables companies to handle larger international orders, leading to more business and revenue.
- Preventing Financial Problems: Provides financial support to avoid payment delays and keep operations running smoothly.
Blockchain Enhancing Trade Finance
Blockchain technology can make trade finance even better by increasing security, transparency, and efficiency:
- Immutable Records: Blockchain creates a permanent and tamper-proof record of transactions, reducing the risk of fraud.
- Smart Contracts: These self-executing contracts automatically enforce agreements without needing intermediaries.
- Transparency and Traceability: Blockchain’s transparent ledger ensures that all transactions are visible and traceable, reducing disputes and increasing trust.
- Speed and Efficiency: Automates processes, speeding up trade finance operations, leading to faster payments and quicker shipment processing.
Trade finance is essential for global trade, reducing risks and improving cash flow. Blockchain technology enhances trade finance by making it more secure, transparent, and efficient and Olea has been playing a large role for providing the service that allows traders, investors, suppliers, buyers, and banks using this blockchain technology.
Trade Finance Technology as an Innovation: The Olea Platform
The innovative technology that becomes the starting layer for Olea’s success with partnerships and growth that will be later discussed in this article, is the integrated trading network platform. Olea’s platform effectively connects the supplier chain from the banks, investors, partners, suppliers to the buyers, in an integrated cycle.
This platform is managed by a mix of Artificial intelligence, Data infrastructure, Cloud, Blockchain that allows the operation of the investor-buyer-supplier pathway from workflow and risk management, sustainability, and to the settling technology as well.
Olea makes it easy for businesses to do secure transactions online through its Funder Portal. This portal helps keep track of assets and report on risks. It shows funders important details like how assets are being used, how much money they're making, and who owes what.
Olea partners with banks and other financial companies who see investing in Supply Chain Finance as a good idea. These partners can tell Olea what kind of investments they're interested in, and Olea will set up programs that match. When a deal is made, there's a contract called a Receivables Purchase Agreement that lays out the rules. After making sure everything checks out, Olea assigns the right invoices to the right funders. This makes sure the money goes where it needs to.
Outlook of Olea’s Important Steps that Led Itself to Become a Trusted Partner and Venture in the Asian Trading Market
Outline
- How Olea Created a Strong Base for its Growth
- Strategic Collaboration with YES BANK as a step into India
- Kick-off in Europe with Silver Birch Finance
- Olea-Vayana Partnership on the Go
- Entry into Vietnam
How Olea Created a Strong Base for its Growth
Olea was set up for success thanks to the strong partnership between Standard Chartered and Linklogis. Along with this, what really made everything possible and added onto Olea’s reliability is the next-generation technology platform mentioned previously.
They combined expertise in international trade with this advanced supply chain finance technology. Led by Amelia Ng and Letitia Chau, Olea used blockchain and AI to improve efficiency and transparency.
Launching at a time when businesses needed reliable financing post-pandemic, Olea offered comprehensive solutions to meet these needs. With a history of successful collaboration and a focus on customer satisfaction, Olea was well-positioned to transform trade finance and support global commerce effectively.
Strategic Collaboration with YES BANK as a step into India
Olea's expansion into India, facilitated by a partnership with YES BANK, has strengthened its position in one of the largest trading markets. This collaboration merges Olea's strengths with YES BANK's expertise in trade finance.
Emphasizing their commitment to innovation, Amelia and Ajay Rajan highlighted the partnership's potential to provide critical working capital solutions to Indian MSMEs, aligning with India's export promotion initiatives.
The alliance supports India's goal of achieving USD 2 trillion in exports by 2030 and propelling the country towards becoming a USD 10 trillion economy. By enhancing trade finance solutions and introducing advanced digital processes, the partnership aims to drive significant export growth and economic development.
This collaboration marks a crucial step in advancing India's trade finance sector, supporting MSMEs, and aligning with the country's broader economic goals, positioning Olea as a key player in one of the world's largest markets.
Kick-off in Europe with Silver Birch Finance
In January 2023, Olea partnered with Silver Birch Finance, a UK-based working capital firm, to provide liquidity to Asian exporters and facilitate smoother trade with European buyers.
This collaboration aims to bridge the funding gap for Asian exporters entering European markets, leveraging Olea's technology platform and global investor network, along with Silver Birch Finance's European market expertise and corporate relationships. Amelia and Sean Hanafin highlighted the partnership's role in connecting the Asia-Europe trade corridor and improving access to finance in Asia. While initially focusing on this corridor, Olea and Silver Birch Finance have plans to expand their collaboration in the future.
This partnership exemplifies Olea's commitment to global trade facilitation and its ability to forge impactful collaborations. For future entrepreneurs, Olea's journey demonstrates the importance of innovation, collaboration, and sustainability in addressing challenges in the trade finance landscape.
Entry into Vietnam
The Vietnamese market was Olea’s next entry and was calculated aiming to offer smart trade finance solutions to businesses and banks involved in global trade. Their collaboration with ASEAN Business Partners (ABP), a company aiding international firms in ASEAN, was a major step. ABP's expertise in supporting businesses across ASEAN matched Olea's goals perfectly.
The main aim was to help Vietnamese exporters with vital trade finance solutions while using advanced technology to make financing easier and operations smoother. Vietnam's booming economy made it an ideal place for such efforts, especially with the rising demand for financial services in global trade.
Letitia Chau stressed their commitment to helping businesses thrive globally, while Sumit Dutta, ABP's CEO, highlighted the growing interest in Vietnamese products, especially in the US and Europe. ABP offered tailored support across ASEAN, with skilled professionals providing strategic help and Olea's partnership with ABP showed their dedication to expanding and offering customized solutions to businesses navigating global trade complexities. This collaboration demonstrates how teamwork and innovation can lead to success, a lesson valuable for aspiring entrepreneurs.
(Refer to : Olea announces entry into Vietnam to offer trade finance solutions)
Olea-Vayana Partnership on the Go: Indian MSMEs Finance Enhancement
On May 19, 2022, Olea and Vayana Network, a financial technology company focusing on trade finance solutions, announced a partnership. Their goal? To help small Indian businesses, especially those in manufacturing, get money quickly and easily.
This partnership comes at a time when more and more big companies are setting up factories in India. This helps Indian businesses grow, but many of them struggle to get loans, with a total of about $380 billion needed. The Indian government has launched programs like "Make in India" to boost manufacturing and exports. Olea and Vayana's partnership supports these efforts by making it easier for small exporters to get funding.
One big step in this partnership is working with Pearl Global Industries Limited, a big clothing manufacturer. They've already gotten a loan through Olea and Vayana, showing how this partnership can help businesses get money fast and without much hassle.
In 2022, India sold a record $44 billion worth of textiles to other countries. This growth means more businesses need money to keep up with demand. Letitia Chau, from Olea, and Ram Iyer, from Vayana, both talked about how important it is to help Indian businesses succeed and grow. They want to help India reach its goal of selling $2 trillion worth of goods to other countries by 2030.
In the future, Olea and Vayana plan to help finance deals worth over $500 million, which would be a huge help to small Indian businesses.
Olea has become successful by making smart partnerships and focusing on helping businesses get the money they need. Their partnership with Vayana is a great example of how they use local knowledge and global technology to find new ways to help businesses. This isn't just good for small businesses—it helps the economy grow too. Olea is committed to helping businesses grow and succeed, and their partnership with Vayana shows they're on the right track.
Olea’s Insights with Decreasing the Global Trade Gap
Recently, the trade finance gap reached $1.7 trillion, mainly affecting small and medium-sized enterprises (SMEs). These businesses faced hurdles like strict collateral requirements and slow approval processes, limiting their growth.
Despite these challenges, trade finance remained attractive due to its stability and low default rates. Investors, however, needed scalable solutions to manage investments efficiently. Olea addressed this by creating a fully digital platform. For suppliers, Olea provided quick access to financing through an online portal, using AI to streamline document verification. For investors, Olea used blockchain to ensure transparent and secure transactions, integrating sustainability criteria for reliable investment options.
The partnership between Standard Chartered and Linklogis combined trade expertise with advanced technology, making Olea a comprehensive solution. By easing access to capital for SMEs and offering scalable investment opportunities, Olea supported sustainable growth and enhanced the global trade ecosystem.
(Refer to : A new approach to closing the trade finance gap)
The Main Trick that Lead to Olea’s Rapid Growth
It can be argued that Olea’s success was mainly just because it is joined by Standard Chartered and Linklogis which are already successful. However, Olea’s growth did not solely depend on this but its efforts and strategies to grow bigger and main takeaways is in fact what kindled its success.
Olea's remarkable growth from 2020 to 2023 serves as a compelling case study for aspiring startups aiming to thrive in the global trade finance landscape. The key to Olea's rapid expansion lies in its strategic approach to addressing post-pandemic financing challenges as well as making the trading platform technology being the base of this. By recognizing the need for innovative solutions and leveraging advanced technology, Olea positioned itself as a leader in the industry. Its emphasis on customer satisfaction, coupled with a commitment to sustainability, set it apart.
Through bold market entries into emerging economies and strategic partnerships, Olea not only drove export growth but also supported the growth of small and medium-sized enterprises (SMEs). Future startups can learn from Olea's journey by prioritizing innovation, fostering strategic collaborations, and staying attuned to evolving market needs to achieve sustainable growth in the competitive business landscape.
Written by Mytri Korsipati (underdogs)
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