The global non-bank trade finance market stands at a market size of 7616 billion dollars and it is estimated to grow at a compound annual rate of 5.3%. But earlier in 2019, this market was at a value of 8942 billion dollars, and this decrease in value has been an impact of the pandemic.
However, the market value of this global non-bank trade finance market has been expected to grow to a steady 10426 billion dollars by the end of its forecast period in 2026.
This growing popularity in this market can be owed to the worldwide dependence of world trade on trade finance. Now that the market size, CAGR, and covid effects of this market have been perceived, it’s important to understand the trends which contribute to these factors. For instance, the rise in worldwide imports and export is the most significant factor which is expected to raise this market.
Other than that, certain trends in technologies like optical character recognition (OCR), quick response or QR codes, and radio frequency identification (RFID) contribute hugely to trade finance, thereby enhancing this market.
Apart from the above mentioned factors, there are other growing developing technologies such as the Internet of Things (IoT), blockchain technology, and natural language processing integrated with AI (artificial intelligence) which ease out invoice financial transactions and consequently amplify the global non-bank trade finance market. Banks also play an instrumental role in boosting the commercialization of the global non-bank trade finance market as they are implementing transparent financial policies and becoming service providers in this global non-bank trade finance market. Strategic development and the use of pricing policies are also being considered as factors that might lead to the growth of the global non-bank trade finance market.
Region-wise analysis of the global non-bank trade finance market would demonstrate that although China is expected to witness the highest growth of the entire market, Europe is estimated to be the most lucrative region for this market in its forecast market. The pandemic has not only affected production and demand but also disrupted the supply chain management of the global non-bank trade finance market.
Some of the big names in this market include Clear Treasury, Falcon, LiquidX, Trade Finance Global, Ebury, etc.
Now, proceeding to the market segmentation aspect of this market. It can be classified into the Letter of Credit, Supply Chain Finance (SCF), Factoring, Documentary Collection, and so on.
The SCF segment is expected to have the highest growth in this market due to corporate liquidity and in 2019, APAC held the largest share of this market.
However, going by the application of this market, it can be categorized into finance, power generation, renewable resources, transport, metals, non-metals, etc. The applications of this market are thus extremely diverse.
