Asia Pacific Trade Finance Market is estimated to witness a rise in revenue from US$ 3,444.3 Bn in 2021 to US$ 5,711.0 Bn by 2030. The market is registering a CAGR of 5.8% during the forecast period 2022-2030.
Trade finance signifies financing for trade, that is used by traders, buyers, sellers, manufactures, importers, and exporters which concerns both domestic and international trade transactions. In order to make a trade transaction, it requires a seller of goods and services as well as a buyer to ease financing activities and deal with cash, credit, investments, and other assets for trade purposes.
Market Dynamics
The major factor responsible for the growth of the Asia Pacific trade finance market includes rapid expansion of BFSI sector in Asia Pacific region and policy reforms for better integration of SMEs in trade financing. Banks play a critical role in international trade by providing trade finance products that reduce the risk of exporting. The rapid expansion of banks and their increasing ability to adopt new technologies like Blockchain Technology, Internet of Things and Application Programming Interface (API) have helped them to remain as a cost-effective and trusted service provider for trade finance. Moreover, policy reforms for better integration of SMEs in trade financing have always remained a very core and essential ingredient for economic growth and employment generation across many regions of the global economy. Furthermore, collaboration between government and international institutions for development of digital infrastructure provides a lucrative growth opportunity in the Asia Pacific trade finance market. However, the continued use of paper-based transactions and lack of adequate business information on borrower firms are some of the factors that restrict the growth in the Asia Pacific trade finance market.
Report Summary
The study of the Asia Pacific trade finance market considers various market determinants, industry value chain analysis and competitor analysis of the market. The report discusses the analysis of the trade finance industry for the period 2017-2030, where the base year is 2021 and the forecast period is 2022-2030. The report provides a detailed analysis of the Asia Pacific Trade Finance Market across 24 Chapters and 311 pages. The report includes data presentation across 75 tables and 238 statistical figures.
The report provides PESTLE analysis, which is a tool to examine the external market environment factors that have an impact on the industry. The PESTLE analysis examines the Political, Economic, Social, Technological, Environmental and Legal factors in the external environment. Thus, sufficiently examining the threats and weaknesses of the industry. The research report also provides Porter’s five forces analysis wherein bargaining power of buyers and competitive rivalry is high.
The subsequent section provides details of the market analysis based on different segments such as offering, provider type, application, end user and country. The report includes detailed study of value chain of the industry. It includes exporters, financial institutes and importers. The report also covers extensively about the key competitors in the market for trade finance.
Impact of COVID-19 on Asia Pacific Trade Finance Market
The Coronavirus (COVID-19) pandemic had a devastating effect on economies and societies worldwide. International trade has been affected by a reduction in the supply of trade finance. During this phase, the demand for trade was reduced due to lockdowns. Still, there was a surge in the specific demand for COVID-19 related goods and protective equipment, as well as for essential foods. The reduction in demand for goods had been compounded by liquidity shortfalls in the poorest countries. Moreover, social distancing and changes in working conditions have also resulted in the change in preferences of consumer toward trade finance in the market.
Key Takeaways from the Asia Pacific Trade Finance Market Report
Company Profile
Competitive Landscape
The key players in the Asia Pacific Trade Finance Market are Asian Development Bank, Banco Santander, S.A., Bank of America Corporation, Standard Chartered plc, BNP Paribas S.A., Citigroup Inc., Crédit Agricole Group and Goldman Sachs Group, Inc. among others. Through extensive research, it is found that big players have adopted various competitive strategies such as mergers & acquisitions in order to have a grip of emerging market. Furthermore, leading companies are expanding their geographical boundaries by acquiring small brands and domestic companies.
Segmentation Overview
Asia Pacific Trade Finance Market is segmented based on offering, provider type, application, end user and country. The industry trends in the Asia Pacific trade finance market are sub-divided into different categories in order to get a holistic view of the Asia Pacific marketplace.
Following are the different segments of the Asia Pacific Trade Finance Market:
By Offering segment of the Asia Pacific Trade Finance Market is sub-segmented into:
By Provider Type segment of the Asia Pacific Trade Finance Market is sub-segmented into:
By Application segment of the Asia Pacific Trade Finance Market is sub-segmented into:
By End User segment of the Asia Pacific Trade Finance Market is sub-segmented into:
By Country segment of the Asia Pacific Trade Finance Market is sub-segmented into:
Trade finance signifies financing for trade, that is used by traders, buyers, sellers, manufactures, importers, and exporters which concerns both domestic and international trade transactions.
Trade finance includes issuing letters of credit (LCs), receivables & invoice finance, credit agency, export finance, bank guarantees and insurance.
Flexibility, convenience, security and transaction flow are the benefits of trade financing as it facilitates easy way to arrange short-term finance.
Various intermediaries such as banks and financial institutions can facilitate these transactions by financing the trade in order to help diminish the risks and allow transactions to go smoothly for buyers and sellers worldwide.
Due to COVID-19 pandemic, the international trade has been affected by a reduction in the supply of trade finance. Also, during this phase, the demand for trade was reduced due to lockdowns and several government restrictions.
The Asia Pacific trade finance market is estimated to expand at a CAGR of 5.8% during the forecast period.
The Asia Pacific trade finance market was valued at US$ 3,444.3 Billion in 2021.
The collaboration between government and international institutions for development of digital infrastructure provides a lucrative growth opportunity in the Asia Pacific trade finance market.
Factors such as rapid expansion of BFSI sector in Asia Pacific region and policy reforms for better integration of SMEs in trade financing will boost the Asia Pacific trade finance market during the forecast period.
Heavy use paperwork and documentation in transactions is a restraining factor which inhibits the growth of the market during the forecast period.
The banks segment is expected to project the highest CAGR over the forecast period in the Asia Pacific trade finance market.
Offering, provider type, application and end user are the different segments of the Asia Pacific trade finance market.
Adoption of sustainable trade finance provides a lucrative growth trend in the Asia Pacific trade finance market.
The key players operating in the market include Asian Development Bank, Banco Santander, S.A., Bank of America Corporation, Standard Chartered plc, BNP Paribas S.A., Citigroup Inc., Crédit Agricole Group and Goldman Sachs Group, Inc. among others.