Standard Chartered And Linklogis Launches Olea For Sustainable Trade Finance
As per the latest news on Sept. 8th, 2021, Standard Chartered, a leading banking group, and Linklogis, a supply chain finance technology provider in China, have declared a joint venture to set up Olea. The fully-digitized trade finance origination and distribution platform are focused on catering to the requirements of institutional investors who are looking for opportunities in an alternative asset with businesses in need of acquiring supply chain financing.
The blockchain trade finance platform named Olea is headquartered in Singapore and will be operated by Amelia Ng (SC Ventures, the innovation, fintech, and ventures unit of Standard Chartered) as CEO and Letitia Chau (Vice-Chairperson and Chief Risk Officer of Linklogis) as deputy CEO
According to Ng, “By considering Standard Chartered’s global trade and proficiency in risk management as well as quality information about Asia, Africa, and the Middle East with Linklogis’s advancements in supply chain technology, Olea is well-positioned to restructure trade finance and introducing power for good.”
“Olea is focused on disrupting the existing trade finance structure by coordinating suppliers’ financing requirements with alternative liquidity from investors looking for a compelling asset class associated with the real economy.”
“Standard Chartered is not only one of the institutional shareholders in Linklogis, but also a critical strategic partner. Since 2019, Standard Chartered and Linklogis have achieved several projects together. The above-mentioned new joint venture, Olea, provides an agile and strong platform with the use of blockchain and AI technology to boost existing efficiency and transparency for suppliers looking for cost-effective and easy financing.”
Olea’s Focal Points:
According to this platform’s supporters, Olea will help bring together:
1. Institutional investors looking for opportunities in an alternative asset class2. Organizations who need supply chain financing, subject to administrative approval
For an uninterrupted operation of global trade, and sustainable economic development, trade financing is essential. This becomes even more important when businesses from all over the world are trying to get back to the post-pandemic level and associated lockdowns. In effect, Olea expects to bring Linklogis and Standard Chartered together on one platform. In addition to this, it also hopes to demonstrate an upcoming generation of supply chain financing by facilitating:
2. Risk evaluation
3. Fulfillment of institutional interest for elective ventures
Through Olea’s risk analytics and safe platforms, the investors can search for, and access, various venture options with their returns that fit best with their required risk profiles. By doing this, the blockchain platform gives a transparent, possibly speedier with issues to access working capital for supply chain members regardless of size:
1. Investors can access a wide range of trade finance assets across the world, and especially in Asia, with reliable knowledge of asset quality
2. Supply chain members can access financing with the help of transparent and easy-flowing processes.
As per Charles Song, Founder, Chairman, and CEO of Linklogis, “The approach and implementation of arising advancements have become an essential leading force for the worldwide economic change, and latest technologies are being applied in several fields such as trade finance and supply chain finance,”
“Being the largest technology service provider for supply chain finance, Linklogis is capable of bringing its exceptional operating experiences and industry-driving technologies into Olea. We believe that the joint attempt between two firms can lead to a flexible, sustainable, and scalable supply chain financing business recommendation.”
Enterprise Times: what does this mean
The relationship between Standard Chartered and Linklogis started in February 2019 when a memorandum of understanding was signed by both the firms to discover the co-formation of arrangements that upheld the supply chain finance ecosystem. They executed their first joint deep-tier supply chain financing transaction in August 2019.
Later, they performed other transactions and, in January 2020, Standard Chartered declared a strategic venture in Linklogis. This demonstrated the Bank’s first investment in a supply chain platform in China.
In terms of financing, this could reflect another opening (in comparison to more conventional trade finance activities). Whether Olea can prosper when competing against the extensive association structure of TradeLens remains an open doubt. Trade finance as a solitary “strength” may have become outdated, even with the latest financing sources that Olea hopes to get.