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Trade Finance Market by Trade Finance Instruments and Geography - Forecast and Analysis 2020-2024

  • Published: Apr 2020
  • Pages: 120
  • SKU: IRTNTR40571
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The trade finance market share is expected to increase by USD11.25 billion from 2019 to 2024, and the market’s growth momentum will accelerate at a CAGR of 4%.

This trade finance market research report extensively covers trade finance market segmentation by geography (APAC, Europe, MEA, North America, and South America) and trade finance instruments (traditional trade finance, supply chain finance, and structured trade finance). The trade finance market report also offers information on several market vendors, including Banco Santander SA, Bank of America Corp., BNP Paribas SA, Citigroup Inc., Crédit Agricole Group, Goldman Sachs Group Inc., HSBC Holdings Plc, JPMorgan Chase & Co., Morgan Stanley, and Wells Fargo & Co. among others.

What will the Trade Finance Market Size be During the Forecast Period?

Download the Free Report Sample to Unlock the Trade Finance Market Size for the Forecast Period and Other Important Statistics

 

Trade Finance Market: Key Drivers, Trends, and Challenges

Based on our research output, there has been a negative impact on the market growth during and post COVID-19 era. The growing number of exports is notably driving the trade finance market growth, although factors such as the impact trade wars may impede the market growth. Our research analysts have studied the historical data and deduced the key market drivers and the COVID-19 pandemic impact on the trade finance industry. The holistic analysis of the drivers will help in deducing end goals and refining marketing strategies to gain a competitive edge.

Key Trade Finance Market Driver

One of the key factors driving growth in the trade finance market is the growing number of exports. The rapidly increasing globalization and the reducing strictness on trade barriers by the World Trade Organization (WTO) will lead to an increase in exports across the globe, which, in turn, will lead to the growth of trade finance during the forecast period. During the exports, when shipment left the domestic customs, it can take a significant amount of time in transit before reaching the customer. The trade finance vendors will help domestic enterprises by providing them the value for their product as soon as the shipment leaves the domestic customs. These vendors offer the working capital, which would otherwise be remained stuck until the product is delivered. Trade finance aims to maintain a positive cash-flow cycle during product transit. These vendors also take care of the letter of credit, which is required when products are transported cross border to the buyers. This, in turn, helps in building up trust between the seller and the buyer and facilitates easy trade. Thus, with the growth in exports of products and services, the demand for trade finance will also increase during the forecast period.

Key Trade Finance Market Trend

The incorporation of technaology with trade finace is another factor upporting the trade finance market share growth. Technology is an important part of businesses across industries, such as banking, financial services, and insurance (BFSI). Technological innovations, the adoption of automation, and a certain level of standardization have been achieved in trade financing in the last few years. For instance, the bank payment obligation (BPO) is an irreversible undertaking that is given by one bank to pay another bank on the successful matching of a mutually agreed set of data within SWIFT's trade service utility. This reduces manual processes, works as a risk mitigation tool, and helps optimize the working capital of banks.

Key Trade Finance Market Challenge

The impact trade wars will be a major challenge for the trade finance market during the forecast period. A trade war occurs when two countries act against each other by placing restrictions over the opposing country's imports or raising import tariffs. Trade wars can be a reaction to protectionism, which depends on government policies and actions to restrict international trade. A government of any country usually takes protectionist actions to protect their domestic businesses and jobs from foreign competition. This action can also be taken by governments to reduce or balance trade deficits, i.e., when the country's export value is less than its imports. Also, trade wars can occur if a country feels that its competitor nation is following unfair trading practices.

This trade finance market analysis report also provides detailed information on other upcoming trends and challenges that will have a far-reaching effect on the market growth. The actionable insights on the trends and challenges will help companies evaluate and develop growth strategies for 2020-2024.

Parent Market Analysis

Technavio categorizes the trade finance market as a part of the global financial services market. Our research report has extensively covered external factors influencing the parent market growth potential in the coming years, which will determine the levels of growth of the trade finance market during the forecast period.

Who are the Major Trade Finance Market Vendors?

The report analyzes the market’s competitive landscape and offers information on several market vendors, including:

  • Banco Santander SA
  • Bank of America Corp.
  • BNP Paribas SA
  • Citigroup Inc.
  • Crédit Agricole Group
  • Goldman Sachs Group Inc.
  • HSBC Holdings Plc
  • JPMorgan Chase & Co.
  • Morgan Stanley
  • Wells Fargo & Co.

This statistical study of the trade finance market encompasses successful business strategies deployed by the key vendors. The trade finance market is fragmented and the vendors are deploying growth strategies such as investing in advanced technologies and focusing on offering customized solutions to compete in the market.

Product Insights and News

  • Morgan Stanley - The company offers trade division risk management and desk risk management services to the client.

To make the most of the opportunities and recover from post COVID-19 impact, market vendors should focus more on the growth prospects in the fast-growing segments, while maintaining their positions in the slow-growing segments.

The trade finance market forecast report offers in-depth insights into key vendor profiles. The profiles include information on the production, sustainability, and prospects of the leading companies.

Trade Finance Market Value Chain Analysis

Our report provides extensive information on the value chain analysis for the trade finance market, which vendors can leverage to gain a competitive advantage during the forecast period. The end-to-end understanding of the value chains is essential in profit margin optimization and evaluation of business strategies. The data available in our value chain analysis segment can help vendors drive costs and enhance customer services during the forecast period.

The value chain of the global financial services market includes the following core components:

  • Inputs
  • Inbound logistics
  • Operations
  • Outbound logistics
  • Marketing and sales
  • Service
  • Support activities
  • Innovation

The report has further elucidated on other innovative approaches being followed by service providers to ensure a sustainable market presence.

Which are the Key Regions for Trade Finance Market?

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56% of the market’s growth will originate from APAC during the forecast period. China is the key market for trade finance in APAC. Market growth in this region will be faster than the growth of the market in other regions.

The growing support from governments to strengthen trade finance, for increasing exports will facilitate the trade finance market growth in APAC over the forecast period. This market research report entails detailed information on the competitive intelligence, marketing gaps, and regional opportunities in store for vendors, which will assist in creating efficient business plans.

What are the Revenue-generating Geography Segments in the Trade Finance Market?

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The trade finance market share growth by the traditional trade finance segment will be significant during the forecast period. As the market is shifting toward an open account trade, enterprises are shifting toward supply chain trade financing. Traditional trade finance leads to an increase in the cost and complexity of operations for enterprises due to tightening compliance requirements and introduction to capital rules, such as Basel III. This leads to an increase in margin pressure over enterprises. Therefore, some vendors in the market are turning toward offering supply chain financing. The vendors are doing so due to growing globalization, which is leading to intense competition and more businesses opting for open account trade. This is encouraging vendors to offer new trade routes to enterprises. Thus, it will impact the growth of traditional trade finance during the forecast period.

This report provides an accurate prediction of the contribution of all the segments to the growth of the trade finance market size and actionable market insights on post COVID-19 impact on each segment.

 

Trade Finance Market Scope

Report Coverage

Details

Page number

120

Base year

2019

Forecast period

2020-2024

Growth momentum & CAGR

Accelerate at a CAGR of 4%

Market growth 2020-2024

$ 11.25 billion

Market structure

Fragmented

YoY growth (%)

4.98

Regional analysis

APAC, Europe, MEA, North America, and South America

Performing market contribution

APAC at 56%

Key consumer countries

China

Competitive landscape

Leading companies, Competitive strategies, Consumer engagement scope

Key companies profiled

Banco Santander SA, Bank of America Corp., BNP Paribas SA, Citigroup Inc., Crédit Agricole Group, Goldman Sachs Group Inc., HSBC Holdings Plc, JPMorgan Chase & Co., Morgan Stanley, and Wells Fargo & Co.

Market dynamics

Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID 19 impact and recovery analysis and future consumer dynamics, Market condition analysis for the forecast period

Customization purview

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What are the Key Data Covered in this Trade Finance Market Report?

  • CAGR of the market during the forecast period 2020-2024
  • Detailed information on factors that will drive trade finance market growth during the next five years
  • Precise estimation of the trade finance market size and its contribution to the parent market
  • Accurate predictions on upcoming trends and changes in consumer behavior
  • The growth of the trade finance industry across APAC, Europe, MEA, North America, and South America
  • A thorough analysis of the market’s competitive landscape and detailed information on vendors
  • Comprehensive details of factors that will challenge the growth of trade finance market vendors

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Executive Summary

  • Market Overview

Market Landscape

  • Market ecosystem
  • Value chain analysis

Market Sizing

  • Market definition
  • Market segment analysis
  • Market size 2019
  • Market outlook: Forecast for 2019 - 2024

Five Forces Analysis

  • Five Forces Summary
  • Bargaining power of buyers
  • Bargaining power of suppliers
  • Threat of new entrants
  • Threat of substitutes
  • Threat of rivalry
  • Market condition

Market Segmentation by Other 1

  • Market segments
  • Comparison by Other1 placement
  • Traditional trade finance - Market size and forecast 2019-2024
  • Supply chain finance - Market size and forecast 2019-2024
  • Structured trade finance - Market size and forecast 2019-2024
  • Market opportunity by Other1

Customer landscape

  • Overview

Geographic Landscape

  • Geographic segmentation
  • Geographic comparison
  • APAC - Market size and forecast 2019-2024
  • Europe - Market size and forecast 2019-2024
  • MEA - Market size and forecast 2019-2024
  • North America - Market size and forecast 2019-2024
  • South America - Market size and forecast 2019-2024
  • Key leading countries
  • Market opportunity by geography

Drivers, Challenges, and Trends

  • Market drivers
  • Volume driver - Demand led growth
  • Volume driver - Supply led growth
  • Volume driver - External factors
  • Volume driver - Demand shift in adjacent markets
  • Price driver - Inflation
  • Price driver - Shift from lower to higher-priced units
  • Market challenges
  • Market trends

Vendor Landscape

  • Overview
  • Vendor landscape
  • Landscape disruption

Vendor Analysis

  • Vendors covered
  • Market positioning of vendors
  • Banco Santander SA
  • Bank of America Corp.
  • BNP Paribas SA
  • Citigroup Inc.
  • Crédit Agricole Group
  • Goldman Sachs Group Inc.
  • HSBC Holdings Plc
  • JPMorgan Chase & Co.
  • Morgan Stanley
  • Wells Fargo & Co.

Appendix

  • Scope of the report
  • Currency conversion rates for US$
  • Research methodology
  • List of abbreviations

Research Framework

Technavio presents a detailed picture of the market by way of study, synthesis, and summation of data from multiple sources. The analysts have presented the various facets of the market with a particular focus on identifying the key industry influencers. The data thus presented is comprehensive, reliable, and the result of extensive research, both primary and secondary.

TechnavioINFORMATION SOURCES

Primary sources

  • Manufacturers and suppliers
  • Channel partners
  • Industry experts
  • Strategic decision makers

Secondary sources

  • Industry journals and periodicals
  • Government data
  • Financial reports of key industry players
  • Historical data
  • Press releases
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TechnavioDATA ANALYSIS

Data Synthesis

  • Collation of data
  • Estimation of key figures
  • Analysis of derived insights

Data Validation

  • Triangulation with data models
  • Reference against proprietary databases
  • Corroboration with industry experts
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TechnavioREPORT WRITING

Qualitative

  • Market drivers
  • Market challenges
  • Market trends
  • Five forces analysis

Quantitative

  • Market size and forecast
  • Market segmentation
  • Geographical insights
  • Competitive landscape
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The trade finance market market growth will increase by $$ 11.25 bn during 2021-2024.
The trade finance market market is expected to grow at a CAGR of 4% during 2021-2024.
Technavio has segmented the trade finance market market by geography (APAC, Europe, MEA, North America, and South America) and market landscape (traditional trade finance, supply chain finance, structured trade finance, North America, and South America).
Banco Santander SA, Bank of America Corp., BNP Paribas SA, Citigroup Inc., Crédit Agricole Group, Goldman Sachs Group Inc., HSBC Holdings Plc, JPMorgan Chase & Co., Morgan Stanley, Wells Fargo & Co. are a few of the key vendors in the trade finance market market.
APAC will register the highest growth rate of 56% among the other regions. Therefore, the trade finance market market in APAC is expected to garner significant business opportunities for the vendors during the forecast period.
The key factors driving the trade finance market market growth are:
  • growing number of exports
  • incorporation of technology with trade finance
The trade finance market market vendors should focus on grabbing business opportunities from the apac segment as it accounted for the largest market share in the base year.
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