SME, Small Business, small and medium enterprisesNews

UnaCash sees 15% increase in supply chain financing

UnaCash Supply Chain Financing UnaCash expects a rapid increase in the use of supply chain finance (SCF) among Philippine micro, small, and medium enterprises (MSMEs). The company also forecasts that this set of solutions will cover about 15% of the cost of the entire volume of goods and services produced by the sector by 2024.

The forecast follows the examination of the Philippines Supply Chain Finance Market Development Report by International Finance Corp. (a branch of The World Bank), which stated that the Philippine market is estimated to have over $20 billion in “readily available SCF assets to be taken up by banks and NDTLs (non-bank lending institutions that do not take deposits)”.

Considering that the country’s gross domestic product (GDP) is about $394 billion (2021), and MSME accounts for about 40% of this indicator, SCF schemes are ready to take on about 13% of the annual MSME production, with a level of 15% (in terms of about 6% of GDP in 2021) as a very realistic benchmark for SCF companies for the next year, given the high demand for the service and the expected rapid growth in its supply in the local market.

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“Supply chain financing is steadily growing its presence in the country as short-term loans have proven to be effective to support small and medium scale businesses, and we are dedicated to cover operational expenses while making it as accessible as possible to business owners,” said Joana Saplan-Mateo, head of Product of UnaCash Supply Chain Financing.

UnaCash app

UnaCash, an app with a bespoke array of financing solutions for the underbanked, recognizes the potential of the MSME sector in the Philippines, which comprises at least 99.51% of the country’s market. Through one of its services, UnaCash Supply Chain Financing, a revolving credit line and bridged financing facility readily address the gap between supplier and the market’s demands.

This led to successfully addressing the disruption in supply chain turnover beginning in the fourth quarter of 2022, having secured a disbursement target of 64 percent (PHP44.9 million) during a very limited period.

As an emerging national solution in the supply chain finance market, UnaCash SCF identified the top industries in the local setting where SCF has penetrated its market distribution since the fourth quarter of 2022 to present: 29% for retail, 12.95% for construction, and lastly, a growing number of 8.93% for import and export trading industry. This secured collective growth in terms of successfully supporting the business continuity of these MSMEs.

UnaCash SCF also sees great potential in introducing supply chain financing in growing industries such as health and medical, manufacturing, IT solutions, e-commerce, and agriculture.

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