India Supply Chain Finance Market - By Offerings (Export & Import Bills, Letter of Credit, Performance Bonds, Shipping Guarantees); By Provider (Banks, Trade Finance House); By Application (Domestic, International); By End User (Large Enterprises, Small a

India Supply Chain Finance Market - By Offerings (Export & Import Bills, Letter of Credit, Performance Bonds, Shipping Guarantees); By Provider (Banks, Trade Finance House); By Application (Domestic, International); By End User (Large Enterprises, Small and Medium-sized Enterprises (SMEs)); By Region (North India, South India, East India, West India), Trend Analysis, Competitive Landscape & Forecast, 2019–2029

India Supply Chain Finance Market to Expand at Significant CAGR of 8.4% During 2023–2029

India supply chain finance market is flourishing because of growing e-commerce and the digital economy and favorable initiatives by the government.

BlueWeave Consulting, a leading strategic consulting and market research firm, in its recent study, estimated India supply chain finance market to grow at a CAGR of 8.42% during the forecast period between 2023 and 2029. Major growth drivers for India supply chain finance market include the rising need for financing working capital and the increasing use of digital technologies. In India, businesses often struggle with extended payment terms and delayed payments, which can significantly affect their cash flow. However, supply chain finance offers a solution to these difficulties by granting businesses access to quicker payments and more cost-effective funding. Digital tools and platforms are also simplifying the management of supply chain finance activities, including purchase order financing, invoice discounting, and supplier financing. Additionally, the Indian government is promoting the adoption of supply chain finance by implementing initiatives like the Trade Receivables Discounting System (TReDS), an online platform that facilitates the financing of invoices issued by MSMEs. TReDS has been instrumental in improving the cash flow of these businesses. Consequently, these factors are expected to drive the growth of the supply chain finance market in India during the forecast period. However, limited access to credit and collateral requirements makes it difficult for SMEs to obtain financing. Is anticipated to restrain the overall market growth.

India Supply Chain Finance Market– Overview

The supply chain finance market in India is growing rapidly as more companies recognize the benefits of this financing method. Supply chain finance, also known as supplier finance or reverse factoring, is a financial solution that allows businesses to optimize their cash flow by leveraging their supply chain relationships. In India, supply chain finance is primarily driven by the need for working capital financing. Indian companies face significant challenges in managing their cash flow due to long payment terms, delayed payments, and an excessive cost of credit. Supply chain finance can help alleviate these issues by providing access to lower-cost funding and faster payment processing. The Indian government has also been promoting the adoption of supply chain finance through initiatives such as the Trade Receivables Discounting System (TReDS), which is an online platform that facilitates the financing of invoices raised by MSMEs (Micro, Small and Medium Enterprises). The TReDS platform has been instrumental in improving the cash flow of MSMEs by providing them with access to low-cost funding and quicker payments.

Impact of COVID-19 on India Supply Chain Finance Market

COVID-19 had a detrimental impact on the supply chain finance market in India. The lockdowns and disruptions to supply chains resulted in delayed payments, reduced cash flow, and increased working capital requirements for many businesses, particularly SMEs. It increased the demand for supply chain finance solutions that can help businesses manage their cash flow and optimize their working capital. Simultaneously, the pandemic also led to a tightening of credit conditions, making it more difficult for businesses to access financing. As a result, many businesses are turning to supply chain finance solutions as an alternative to traditional bank loans. In addition, the pandemic accelerated the adoption of digital solutions for supply chain finance, as businesses have been forced to move their operations online. This led to the growth of digital platforms such as the Trade Receivables Discounting System (TReDS), which provides SMEs with access to financing options that are more flexible and accessible than traditional bank loans.

India Supply Chain Finance Market – By Provider

By provider, India supply chain finance market is bifurcated into Banks and Trade Finance House segments. The banks segment holds a higher share in the India supply chain finance market due to their established presence in the financial market, enabling them to offer a range of supply chain finance solutions. Banks have established relationships with their customers, allowing them to provide customized solutions tailored to specific needs. They offer a wide range of products, including export and import financing, accounts receivable financing, and inventory financing, catering to diverse financing needs of businesses. Banks in India have actively adopted technology to improve their supply chain finance operations, and the supportive regulatory environment by the Reserve Bank of India has encouraged banks to offer supply chain finance solutions to their clients.

Competitive Landscape

Major players operating in India supply chain finance market include Axis Bank Limited, State Bank of India, ICICI Bank Limited, HDFC Bank Limited, Yes Bank Limited, Kotak Mahindra Bank Limited, Standard Chartered Bank Limited, DBS Bank India Limited, IndusInd Bank Limited, IDFC First Bank Limited, Punjab National Bank, Bank of Baroda, Federal Bank Limited, Canara Bank, and Indian Bank. To further enhance their market share, these companies employ various strategies, including mergers and acquisitions, partnerships, joint ventures, license agreements, and new product launches.

The in-depth analysis of the report provides information about growth potential, upcoming trends, and statistics of India Supply Chain Finance Market. It also highlights the factors driving forecasts of total market size. The report promises to provide recent technology trends in India Supply Chain Finance Market and industry insights to help decision-makers make sound strategic decisions. Furthermore, the report also analyzes the growth drivers, challenges, and competitive dynamics of the market.