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Mercore and Tradeable complete their first digital bill of exchange transaction in Africa, supporting trade between Kenya and Belgium
Mercore, the global trade-focused fintech group, in collaboration with Tradeable House Africa, announced today that it has completed a receivables purchase transaction backed by digital bills of exchange. The finance facility will support a Kenyan producer of organic pesticides growing its sales into Belgium and the wider European Union. The deal is Mercore’s first digital negotiable instrument-backed facility to execute in Africa, and there are several more in the pipeline working together with Tradeable as its strategic partner in the region.
How it works
Mercore enabled the Kenyan supplier and Belgian buyer to generate and sign the digital bills of exchange (DBE), utilizing Mercore’s digital execution platform (powered by trace:original). The financing arm of the group, Mercore Capital, working together with its Africa trade facilitation partner, Tradeable House Africa, thereafter, purchased the DBEs under a ‘Digital Receivables Finance Agreement’ drafted by Sullivan & Worcester UK LLP. The DBEs were executed under English law leveraging the recently enacted Electronic Trade Documents Act 2023. The underlying DBEs also included several of the International Trade & Forfaiting Association’s (ITFA) suggested clauses from the 2023 Addendum to the ITFA Digital Negotiable Initiative’s Handbook.
Why it matters
The use of digital payment instruments, such as this DBE, enables parties to execute quicker (typically same day) at lower costs. A DBE is also a more sustainable alternative to traditional paper-based negotiable instruments which, in turn, helps to drive greater financial inclusion – something that Mercore is committed to. Additionally, with many of the typical paper-based processes having been significantly challenged in recent times (COVID, delivery delays, strikes, etc), electronic execution greatly improves operational resilience and minimizes disruption.
Anthony Wadsworth-Hill, Co-founder, DCEO & COO of Mercore said: “Mercore is delighted to execute this ‘digital bill of exchange’ transaction between Kenya and Belgium, leveraging one of the UK’s best exports, ‘English law’. We relentlessly strive to improve financial inclusion for SMEs and those companies transacting with developing markets. With this facility, we are supporting both of those areas and helping to close the $2.5 trillion global trade finance gap. We look forward to continued collaboration with our industry partners and supporting existing and new customers with their trade financing requirements going forward. This is exciting progress, and it’s just the beginning.”
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Sources :
https://www.gtreview.com/news/fintech/mercore-seals-first-digital-bill-of-exchange-deal-in-africa/
