The Trends in Global Non-Bank Trade Finance Market

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, the global non-bank trade finance 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 the global non-bank trade finance market can be owed to the worldwide dependence of world trade on trade finance. Now that the market size, CAGR and covid effects of the global non-bank trade finance market has been perceived, it’s important to understand the trends which contribute to these factors. For instance, the rise in worldwide import and export is the most significant factor which is expected to raise the global non-bank trade finance 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 the global non-bank trade finance market.

Apart from the above-mentioned factors, there are other growing developing technologies such as the Internet of Things (IoT), block chain technology, natural language processing integrated with AI (artificial intelligence) which ease out the 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 on 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 global non-bank trade finance 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 global non-bank trade finance market include Clear Treasury, Falcon, LiquidX, Trade Finance Global, Ebury, etc.

Now, proceeding to the market segmentation aspect of the global non-bank trade finance 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 the global non-bank trade finance market due to corporate liquidity and in 2019, APAC had held the largest share of the global non-bank trade finance market.

However, going by the application of the global non-bank trade finance market, it can be categorised into finance, power generation, renewable resources, transport, metals and non-metals, etc. The applications of this global non-bank trade finance market are thus extremely diverse.

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