Global Trade Supplier Finance (IFC-28723)

  • World
Geographic location where the impacts of the investment may be experienced.
Financial Institutions
  • International Finance Corporation (IFC)
International, regional and national development finance institutions. Many of these banks have a public interest mission, such as poverty reduction.
Project Status
Stage of the project cycle. Stages vary by development bank and can include: pending, approval, implementation, and closed or completed.
Bank Risk Rating
Environmental and social categorization assessed by the development bank as a measure of the planned project’s environmental and social impacts. A higher risk rating may require more due diligence to limit or avoid harm to people and the environment. For example, "A" or "B" are risk categories where "A" represents the highest amount of risk. Results will include projects that specifically recorded a rating, all other projects are marked ‘U’ for "Undisclosed."
Voting Date
Sep 21, 2010
Date when project documentation and funding is reviewed by the Board for consideration and approval. Some development banks will state a "board date" or "decision date." When funding approval is obtained, the legal documents are accepted and signed, the implementation phase begins.
Companies' Suppliers
A public entity (government or state-owned) provided with funds or financial support to manage and/or implement a project.
  • Industry and Trade
The service or industry focus of the investment. A project can have several sectors.
Investment Type(s)
Guarantee, Loan
The categories of the bank investment: loan, grant, guarantee, technical assistance, advisory services, equity and fund.
Investment Amount (USD)
$ 1,000.00 million
Value listed on project documents at time of disclosure. If necessary, this amount is converted to USD ($) on the date of disclosure. Please review updated project documents for more information.
Loan Amount (USD)
$ 500.00 million
Value listed on project documents at time of disclosure. If necessary, this amount is converted to USD ($) on the date of disclosure. Please review updated project documents for more information.
Project Cost (USD)
$ 1,000.00 million
Value listed on project documents at time of disclosure. If necessary, this amount is converted to USD ($) on the date of disclosure. Please review updated project documents for more information.
Primary Source

Original disclosure @ IFC website

Updated in EWS Nov 24, 2023

Disclosed by Bank May 14, 2010

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Project Description
If provided by the financial institution, the Early Warning System Team writes a short summary describing the purported development objective of the project and project components. Review the complete project documentation for a detailed description.

As stated by the IFC, the proposed project, Global Trade Supplier Finance (“GTSF” or the “Program”) is a joint investment and advisory program to provide short-term financing to exporters (“Suppliers”) in emerging markets selling to large international companies (“Buyers”) on open account terms. In recent years, large global Buyers have increasingly moved their cross-border purchasing to open account trade as a cost-effective alternative to letters of credit and also stretched out payment terms for their purchases to maximize working capital. As a result, Suppliers in emerging markets risk losing sales and becoming less competitive unless they can gain access to new, more efficient types of working capital finance. Supplier Finance (“SF”) involves discounting Suppliers’ receivables on a non-recourse basis once the Buyer has accepted to pay on due date, thus mitigating Supplier performance risk and isolating credit risk to the Buyer. SF can thus provide a sustainable win-win solution for both Buyers and Suppliers allowing them to benefit from the lower costs associated with open account trade and the advantage of the Buyer’s (superior) credit rating to finance the Suppliers.
While the use and awareness of SF in developed economies has increased significantly over recent years, its application in emerging markets is still very limited. IFC is in a unique position to support the increased adoption of SF solutions in emerging markets with Suppliers, most of which are SMEs. In particular, one of the main obstacles faced by Buyers and commercial banks in developing Supplier Finance programs in emerging markets has been the on-boarding of SME Suppliers. SMEs require more training and interaction in order for them to better understand the working capital alternatives available to them and how best to take advantage of Supplier Finance.
IFC will use its experience in Advisory Services (Linkages) to work with local training partners to reach a far larger number of SME Suppliers, thus ensuring higher utilization rates for the program. IFC will engage with select Buyers to identify their Suppliers in emerging markets to participate in the Program and also partner with commercial banks that have Buyer relationships where IFC’s participation will clearly expand the SF program to Suppliers in emerging markets only. GTSF would enable improved access to finance for these Suppliers against Buyer risk through short term loans or guarantees covering Buyer payment risk.

Early Warning System Project Analysis
For a project with severe or irreversible impacts to local community and natural resources, the Early Warning System Team may conduct a thorough analysis regarding its potential impacts to human and environmental rights.

As stated by the IFC, Buyer facilities dealing with the manufacturing supply chain are expected to be considered E&S Category B projects.

Investment Description
Here you can find a list of individual development financial institutions that finance the project.

The investment of the IFC is divided as follows:

Product Line IFC Investment (million USD)
Guarantee 500.0
Loan 500.0

Contact Information
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IFC Program Lead:

Priyamvada Singh - Global Financial Markets
Address: 2121 Pennsylvania Ave, NW, Washington DC 20433
Phone: +1 202 458 4786


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