Cash News
Citi and International Finance Corp. (IFC), a global development institution that is a member of the World Bank Group, have partnered on a $2 billion sustainable supply chain finance program focused on emerging markets.
The first project under the umbrella of this agreement is a $500 million facility in Mexico, the companies said in a Monday (Aug. 5) press release.
This project is the largest to date under IFC’s Global Supply Chain Finance (GSCF) program, which was launched in 2022 to help address supply chain finance gaps for small and medium-sized businesses (SMBs) and to expand access to sustainable supply chain finance, according to the release.
“The role of trade and supply chain finance in facilitating the goods and services essential for sustainability is paramount, and this program will enable suppliers in Mexico, some of whom may not traditionally be considered bankable, to receive such financing,” Nathalie Louatglobal director of trade and supply chain finance at IFC, said in the release.
IFC has been working in Mexico to develop local credit infrastructure, including eInvoice financing, to introduce new reverse factoring and other asset-based financing products, and to strengthen the legal foundation of supply chain finance markets, per the release.
The institution hopes that the new program will support the continued growth of financing provided by Citi and other market participants, according to the release.
“It is our great pleasure to strengthen our collaboration with IFC in the area of sustainable supply chain finance,” Murat Demirelhead of financial resources and risk management, trade and working capital solutions at Citi, said in the release. “Mexico is a great start to launch this joint initiative, and Citi is looking forward to expanding this initiative into other emerging and frontier markets.”
Citi and IFC teamed up more than a decade ago and created IFC’s Global Trade Liquidity Program (GTLP) that debuted in 2009 and connects business to trade financePYMNTS reported in July 2020.
During the pandemic, the two organizations joined forces with an additional $800 million fund aimed at connecting SMBs in emerging markets to trade financing.
Ebru Pakcanwho was global head of trade business at Citi at the time and is now CEO, Middle East and Africa Cluster at the bank, told PYMNTS CEO Karen Webster in July 2020: “We’re living in a world where operational resilience is very important.”
