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Industry roundup: 18 June 2020

Fitch: European MMFs stabilised

European low-volatility net asset value money market funds’ (MMFs) flows have stabilised since a volatile period in March 2020 for all currencies, according to the June 2020 edition of Fitch Ratings' European Money Market Fund Dashboard. 

Total assets in US dollar low-volatility net asset value (LVNAV) MMFs increased by 30% to US$308bn at end-May from end-March. By contrast, total assets in US dollar public-debt constant net asset value (PD CNAV) MMFs dropped by 6% during the same period to US$161bn at end-May. These flows reflected both investors reversing prior allocations to PD CNAVs from LVNAVs and seasonal inflows. 

If the trend that started at end-March continues, Fitch Ratings estimates that total assets in USD LVNAV MMFs should return to their prior February peak around mid-July. Net asset value deviations for USD LVNAV MMFs recovered in April after the market turbulence in March. In May, net asset value deviations for some funds turned positive as the effect of more conservative fund positioning was reflected in market values. Liquidity levels for non-government MMFs have increased and were high across all currencies at end-April. Euro MMFs, on average, remained more liquid than USD and GBP funds from end-March onwards. MMFs’ stances in liquidity vary, with USD funds presenting the widest weekly liquidity positioning range of 40 percentage points, suggesting wider liquidity risk appetite.


Surecomp solution targets enhanced digital trade finance customer engagement

Surecomp, a provider of global trade finance and treasury solutions for banks and corporations, has announced the launch of a front-office solution, Fastrade, designed specifically for small-to-medium sized enterprises (SMEs). Fastrade allows banks to extend trade finance capabilities to their SME corporate clients, while SMEs can now also gain direct access to and benefit from fully digitised trade finance services. The solution - which is available either on the public cloud or on customer premise - enables trade finance providers to enhance customer service and satisfaction by offering their SME clients an intuitive and scalable multi-bank channel for their trade finance process automation.

Trade finance providers of all type and size can use the Fastrade solution, which is now embedded with API connectivity and packaged as an out-of-the-box SaaS offering, to optimise customer engagement and drive growth. Transforming what is sometimes perceived as a complex process into a simplified, easy-to-follow user experience, it supports all commonly used trade finance services, with preconfigured workflows to minimise setup time. The solution is designed to mitigate the risk of human error.


FIS enables instant payments from account 

FIS has announced Open Banking Hub, a payment solution for its Worldpay merchant clients and their customers. Merchants that enable this digital bank account payment method in their online stores can allow customers to pay for purchases directly from their bank account, while also letting them view their bank account balance in real time during the checkout process. Because the solution routes users directly to their personal bank to authorise payment, they never have to enter card or account information into a third-party site.

Worldpay’s Open Banking Hub provides merchants with a single API integration to banking providers. When customers make a purchase via a mobile device through the Open Banking Hub, they are automatically redirected to their banking provider’s app to complete their order. During the online checkout process, the solution intuitively allows the customer to see their bank balance, choose which account they’d like to pay with, and then make the payment in real-time.

For those who have requested a refund, the solution also allows merchants to credit those bank accounts in real-time.


InstaReM service helps Singaporean SMEs improve cash flow

InstaReM, the consumer and SME brand under global fintech platform Nium, has announced the launch of a service that is designed to help Singaporean SMEs maximise their cash flow. The service, termed BizPay, utilises credit limits in corporate cards and converts them into working capital to help businesses make payments, including commercial rent or utilities or other supplier payments. Businesses will continue to enjoy commercial benefits that may be available on their corporate credit cards, such as membership rewards or cash rebates.  

Securing loans or credit can be difficult for SMEs - the absence of a stable and profitable portfolio is seen as a drawback by banks and financial institutions. The additional delays in payments induced by the pandemic have only aggravated this dearth of capital. While businesses may look to card-based payments to extend payment terms, the high transaction fees and FX markup act as a deterrent for payers as well as beneficiaries.  

To address this issue, the online platform BizPay enables businesses to use their corporate cards as a funding source for supplier payments. Using InstaReM’s existing remittance platform, a business would only need to type the name of the beneficiary, the amount and currency of payment and charge the whole payment to their corporate card for funding. There is no need for the beneficiary to be directly card accepting or to be onboarded as part of the payment process. Businesses now gain full control of costs by eliminating fees and charges associated with other credit solution options. 

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