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AI set to transform supply chain management – Industry roundup: 13 April

Artificial intelligence to transform supply chain management, report forecasts

Artificial intelligence (AI) will be worth about US$17.5 billion in the global supply chain management (SCM) software market by 2028, according to a new market report. According to the authors, market analysis shows that AI-enabled supply chains are 67% more effective than their non-AI counterparts, thanks to reduced risks and lower overall costs.

“Global Artificial Intelligence in Supply Chain Management Market by Technology, Processes, Solutions, Management Function (Automation, Planning & Logistics, Inventory, Risk), Deployment Model, Business Type, and Industry Verticals 2023-2028” is a study released by It notes that the Asia-Pacific (APAC) region is expected to be the largest and fastest-growing supplier of AI for the global SCM market. 

The report also examined several forms of AI, including cloud-based AI-as-a-service solutions, which it predicts will be worth more than US$3.7 billion by 2028, reaching more than 21% of the total market in the next five years.

AI technology for SCM that deploys edge computing for Internet of Things (IoT) systems is expected tol achieve a value of US$6.12 billion by 2028. Edge computing gathers and processes data closer to the actual data sources, rather than in a centralised location – something particularly well-suited to the widely dispersed nature of international supply chains. 

The studynotes that material movement and tracking is the largest sub-segment of AI SCM available today. 

The report’s authors say that one of the primary goals is to leverage AI to make supply chain improvements, from production to consumption, within product-related industries as well as to create opportunities for supporting “servitisation” of products in a cloud-based “as a service” model. According to Nexsys, “servitisation” is the idea that companies can sell customers an “outcome as a service” rather than selling them a one-off product. In the manufacturing and supply chain industries, companies provide servitisation by offering additional services to customers in order to increase the use of their traditional products. 

“AI will identify opportunities for supply chain members to have greater ownership of ‘outcomes as a service’ and control of overall product/service experience and profitability,” the report’s authors conclude.


Bank of Canada keeps rates on hold

Canada’s central bank has kept its overnight lending rate on hold at 4.5% for the second successive month, despite few signs of the country’s economic growth cooling.

Bank of Canada officials have expressed confidence that higher borrowing costs are working to slow demand. Economic data nonetheless keep surprising to the upside. The jobs market and wage pressures remain strong. Even house prices show signs of bottoming out after a year-long decline.

However, policymakers led by Governor Tiff Macklem also pushed back against market expectations for an interest rate cut later this year. “What I can say about our deliberations is that based on the information we have today, the implied expectation in the market that we're going to be cutting our policy rate later in the year, that doesn't look today like the most likely scenario to us,” said Macklem.

“We are seeing inflation come down even as the economy continues to grow. That is encouraging. But yes, we do expect growth to be weak. It’s expected to be weak through the rest of the year, pick up gradually over the course of next year.”

Commenting on the Bank’s latest decision, Ryan Brandham, Head of Global Capital Markets, North America at Validus Risk Management, said: “While core inflation remains sticky globally based on tight labour markets, inflation is expected to ease to 3% relatively quickly, but could potentially need further hikes to return to 2%. Inflation expectations coming down are key to this, and Tiff Macklem tried to speak forcefully directly on this point.

“It is rare to see Central Bank officials speak to inflation expectations so directly and bluntly, but if he can prevent expectations from being anchored at current levels, the job of the Bank of Canada will be easier in the future. The BoC emphasised that “the job is not done”, and that it stands ready to hike rates further if needed, in support of this. It also pushed back on market pricing of cuts to come in 2023. The rate market’s reaction was relatively quiet, and the reduction of cuts priced in speaks to credibility.”


Renminbi’s share of trade finance “doubles since start of Ukraine invasion”

The renminbi’s (RMB’s) share of trade finance has more than doubled since the invasion of Ukraine, according to an analysis by the Financial Times— a surge that analysts say reflects both greater use of China’s currency to facilitate trade with Russia and the rising cost of dollar financing.

Trade financing data from the international payments and financing platform SWIFT shows that the renminbi’s share by value of the market had risen from less than 2% in February 2022 to 4.5% a year later. Those gains put China’s currency in close contention with the euro, which accounts for 6% of the total.

Both are, however, still a fraction of the US dollar’s share, which stood at 84.3% in February 2023, down from 86.8% a year earlier.

“This is a substantial move,” said Mansoor Mohi-uddin, chief economist at Bank of Singapore. “It’s hard to think of anything else that could be behind this step change other than what’s happened with the war in Ukraine.”

Mastercard launches Cross-Border Services Express

Mastercard has launched Cross-Border Services Express in partnership with FinTech and Payall Payment Systems to help financial institutions (FIs) set up international payments for their customers.

The companies said that as consumers and small and medium-sized enterprises (SMEs) have a need for improved cross-border payment capabilities, they are looking for ways to send money or pay vendors across the globe in a quick and secure manner. The Cross-Border Services Express tool aims to deliver that completely in a digital-first experience and complements Mastercard's Cross-Border Services offering.

The service works by leveraging a customisable and easy-to-implement digital overlay, while also providing additional tools to meet compliance and regulatory requirements.

Alan Marquard, Executive Vice President of Transfer Solutions at Mastercard said that the company aims to provide choice, access, and transparency for payment across borders. T hrough a simple, turn-key integration, Cross-Border Services Express aims to ‘level the playing field’ and provide small and mid-tier banks, together with credit unions and community banks, with the same international payment features no matter their size and scale.

When leveraging Mastercard’s Cross-Border Services, participating financial institutions are enabled to offer their customers international payments in over 60 currencies to more than 100 markets covering 90% of the world’s population. The service enables users’ flexibility in how they pay by delivering funds to bank accounts, mobile wallets, cards, and cash payout locations with complete transparency and predictability regarding the transaction status and delivery time.

Cross-Border Services Express helps FIs to get to market in an expedited manner, decrease transaction risk, and deliver a modernised payment experience that is sought after by consumers and SMEs alike when carrying out international payments. Additionally, the company is collaborating with fintechs Fable FinTech and Payall Payment Systems to provide the solution via a simplified user interface that helps meet the customers’ increased expectations for digital experiences.

The announcement details that digital payments are increasing, with three-quarters of consumers that send and receive cross-border payments doing so by making use of mobile apps, as per a Mastercard 2022 Borderless Payments Report. Despite this, there is a multitude of challenges associated with transparency and costs, as 39% of SME respondents advised that cross-border payments decelerate their supply chain and one in four reported suppliers’ refusal in collaborating with them due to uncertainty over payment times.

Jane Prokop, Executive Vice President, Small and Medium Enterprises at Mastercard advised that for SMEs it is important to keep money flowing. As per their statement, the Cross-Border Services Express offering is set to help FIs address SMEs’ need for an efficient and digital cross-border payments solution that they can leverage to pay employees, suppliers, and partners alike in a fast and fully predictable manner.


Tranglo expands with cross border SEPA payments to Europe

Malaysia-based cross-border payment solution provider Tranglo has announced the launch of instant single euro payments area (SEPA) payments to Europe, its first large-scale expansion in the region.

The company notes that SEPA facilitates over 43 billion transactions annually, with cross-border payments growing rapidly in the last 10 years. However, cross-border SEPA credit transfers and direct debits accounted only for 3.5% and 4.5% of such transactions in the region, respectively.

Tranglo expects cross-border transactions to SEPA countries to pick up significantly in the coming months, especially among the increasing number of European businesses and consumers abroad looking for real-time payments.

At launch, supported SEPA payout countries are the United Kingdom, Belgium, Croatia, Finland, Germany, Greece, Hungary, Netherlands, Portugal, Slovakia, Spain, and Sweden, with more to follow.

Tranglo Group CEO Jacky Lee said: “We decided to launch this offering to cater to the increasing demand for instant cross-border payments. Our business partners will be delighted to know that Tranglo Connect is integrated seamlessly into SEPA, offering more value per transaction in terms of speed and coverage.”

Tranglo’s instant SEPA payout is available throughout the day and supports individual and business senders and beneficiaries. All transacting bank accounts must be identified by an international bank account number (IBAN).

The company helps financial institutions (FIs) and businesses pay through Tranglo Connect, its proprietary cross-border payments solution. It seamlessly integrates payout and partner services, unifying the end-to-end payment process with direct API access. Tranglo Connect enables companies to make payments to over 30 countries reliably and securely.


Paynetics wins Electronic Money Institution licence from UK regulator

Paynetics UK, the embedded finance and digital banking solutions provider has received its Electronic Money Institution (EMI) licence from the UK’s Financial Conduct Authority (FCA).

Bulgaria-headquartered Paynetics now holds EMI licences in Europe and the UK. “This further strengthens Paynetics’ capabilities by allowing its business partners and customers to seamlessly build programmes that can be deployed throughout Europe and the UK,” said the firm.

Since June 2016 when the UK voted to leave the European Union (EU), Paynetics has been operating under the FCA’s Temporary Permission Regime (TPR). The TPR scheme is due to end in December 2023, so the grant of the EMI licence allows Paynetics to transfer its UK-based customers onto its UK EMI licence.

Executive Chairman, Paynetics, Ivo Gueorguiev said: “Securing the UK EMI licence is a key element in our strategy to provide embedded finance across all of Europe and the UK. We are now able to offer the full range of our products to our UK customers and are particularly excited to be able to support a wider range of consumer-based programmes in the UK. We believe this licence will further add to our growth, and we look forward to investing further in our UK business.”

Mike Peplow, CEO, Paynetics UK added: “Securing the UK EMI licence gives our customers and partners the confidence to expand their business with Paynetics. We believe that by having dual licence capability Paynetics is the natural partner for UK-based organisations who want to deploy in Europe or European-based organisations who want to enter the UK market. We are already building out the UK team and will offer the full range of our embedded finance capability to the UK market.”

Paynetics is a regulated e-money institution that provides end-to-end payment services across the UK, European Union and globally. They are principal members of Mastercard, VISA, UnionPay International, SWIFT and SEPA and can offer both IBANs and UK Sort Codes.


E-commerce software provider Shopline plans Europe expansion

E-commerce software provider Shopline is expanding into Europe. The Singapore-based company, set up in 2013, is launching a European headquarters in London after raising US$182 million last year in order to accelerate its global expansion.

Shopline is a website builder for online merchants, offering customisable themes so sellers can quickly launch their website. The company also offers an omnichannel solution so that users can sell their products on multiple sales channels, such as social media and marketplaces.

According to Shopline, its software solution helps over 500,000 brands with their cross-border sales, payments, marketing and logistics. It has offices in Asia and Australia and more than 2,000 employees worldwide.

Commenting on the launch of its first office in Europe, Deepak Anand, General Manager of Shopline UK, said: “We are super excited to launch Shopline in the United Kingdom at a time when changing customer preferences are requiring merchants to be increasingly agile.

“Selling directly on social media has rewritten the ecommerce playbook on how brands are engaging with their customers. As a global talent hub, London is the perfect fit for Shopline to lead the transformation of European retail while enabling unique shopping experiences that are supporting our customer’s commerce vision.”

In the months ahead, the company will roll out its UK platform for domestic and cross-border commerce. Users can take advantage of the company’s partnerships with Meta, Google, TikTok and Amazon, as well as influencer and dynamic customer segmentation features.


JBIC finances Noirmoutier offshore wind farm in France

The Japan Bank for International Cooperation (JBIC) has signed a €1.1 billion ($1.2 billion) loan agreement with Eoliennes en Mer Iles d'Yeu et de Noirmoutier (EMYN) for an offshore wind farm to be commissioned in France from 2025 and located off the coast of Vendée. Ocean Winds, Sumitomo Corporation, Banque des Territoires and Vendée Energie are shareholders of the company.

The €2.2 billion project involves the construction and installation of a wind farm located 11 km off the island of Yeu and16 km off the island of Noirmoutier. This offshore wind farm will supply nearly 800,000 people with electricity each year, the equivalent of the population of Vendée. The Yeu and Noirmoutier wind farm represents an investment of around €2.5 billion. The signing of the financing agreements took place on April 5.

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