Global Trade Finance Market Overview
Trade Finance is the financing of international trade flows, acting as an intermediary between importers and exporters to mitigate the risks involved in transactions and enhance working capital efficiency in businesses. It deals with activities related to financing of domestic and international trade. The trade finance includes issuing letters of credit (LCs), receivables and invoice finance, credit agency, export finance, bank guarantees, insurance, and others. It is used by buyers, sellers, manufactures, importers, and exporters to ease financing activities and deals with the way cash, credit, investments, and other assets are used for trade. The key advantage of trade finance is that it facilitates easy way to arrange short-term finance. The global Trade Finance market accounted for US$ 42637.89 million in 2020 and is estimated to be US$ 64177.23 million by 2030 and is anticipated to register a CAGR of 4.2%.
Impact of COVID-19 Pandemic on Market
At the starting of 2020, COVID-19 disease began to spread around the world. As the Covid-19 pandemic hits economic activity, the vulnerabilities of longer and more geographically extended trade credit chains are coming to the fore, especially those related to international trade. While risk mitigation is available from financial intermediaries, the bulk of the exposures associated with supply chains are borne by the participating firms themselves, through inter-firm credit. Given the prevalence of the US dollar in trade financing, measures such as central bank swap lines that ease global dollar credit conditions may cushion the impact of the pandemic on global value chains.
Global Trade Finance Market Dynamics
Enhancing Digitization of Trade Documents Drive
The development of technologies such as optical character recognition (OCR) to read container numbers, radio frequency identification (RFID) and quick response (QR) codes to identify and trace shipments, blockchain, and enhancing digitization of trade documents drive the trade finance market growth. Advancements in technology, switching from traditional banking methods for documentation to ease the paperwork, and efficient enhancement in trade finance industry provide opportunities for the market. In addition, strategic formulation along with adoption of structuring and pricing tools offer some other growth opportunities to the market. Support from banks to firm’s ability to mitigate payment risk by purchasing trade credit insurance boosts the market growth.
However, lack of focus of trade financing for SMEs, insufficient risk valuation capabilities, limited legal certainty, and operational inefficiencies restrain the growth of the trade financing market.
Global Trade Finance Market Segmentation
Source: Prophecy Market Insights |Disclaimer: Data is only a representation. Actual data may vary in the final report.
The global trade finance market is segmented based on the product type, services providers, application, and region.
On the basis of product type the global market is segmented into guarantees, letter of credit, documentary collection, supply chain finance, and others. The guarantees segment accounted for the largest revenue in 2018, owing to the fact that agency financing acts as a mediator between buyers and sellers who are involved in international trading. It provides highly structured financing solutions, which, in turn, enhances exporters risk capacity, allowing domestic companies to export goods and services to buyers around the world with a certain level of security. Moreover, international agency financing offer guarantees to cover commercial bank credits, direct funding, and mitigates political risks.
Based on the services providers, the trade finance market is segmented into banks, and trade finance houses. The banks segment generated the highest revenue in 2018 and is anticipated to continue the same during the forecast period, owing to the fact that banks act as intermediaries in trade finance ecosystem to provide inter-firm trade credits to buyers, sellers, and other parties involved in the trade. Furthermore, banks are accelerating trade finance processes by transforming their paper-based methods to more efficient and transparent digitized models, thus becoming the highest service providers in the trade finance market.
Depending upon application, the target market is segmented into energy, finance, transport, power generation, healthcare, metals and non-metallic minerals, renewables, and others. Energy segment show the highest growth in the region due to low interest rates and fees provided by international banks.
Regional Insights:
The global Trade Finance market accounted for US$ 42637.89 million in 2020 and is estimated to be US$ 64177.23 million by 2030 and is anticipated to register a CAGR of 4.2%. On region the global Trade Finance market is segmented into North America, Europe, Asia Pacific, Latin America, and Middle East & Africa. Asia Pacific dominated the trade finance software market in 2019, followed by Europe and North America. This is primarily due to the increasing adoption of trade finance software to manage and automate the trade finance process. Europe is expected to grow at the fastest growth rate during the forecast period owing to the involvement of export credit agencies (ECA) conducting international trade, enhancing public policy from government agencies, and promoting trade across the globe. APAC is characterized by the presence of well-developed as well as developing countries, a strong industry base, and high technology adoption. The presence of fast-growing economics, rising automated technology adoption, and increasing internet penetration, as well as huge adoption of software by end-users, are among the prime factors expected to drive the growth of the trade finance software market in the region
Report Scope:
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Attribute |
Details |
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Base year for estimation |
2020 |
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Forecast period |
2020 – 2030 |
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Market representation |
Revenue in USD Million & CAGR from 2020 – 2030 |
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Market Segmentation |
By Product Type - Guarantees, Letter of Credit, Documentary Collection, Supply Chain Finance, and Others By Services Providers - Banks, and Trade Finance Houses By Application - Energy, Finance, Transport, Power Generation, Healthcare, Metals and Non Metallic Minerals, Renewables, and Others By Region - North America, Europe, Asia Pacific, Latin America, and Middle East & Africa |
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Regional scope |
North America - U.S., Canada Europe - UK, Germany, Spain, France, Italy, Russia, Rest of Europe Asia Pacific - Japan, India, China, South Korea, Australia, Rest of Asia-Pacific Latin America - Brazil, Mexico, Argentina, Rest of Latin America Middle East & Africa - South Africa, Saudi Arabia, UAE, Rest of Middle East & Africa |
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Report coverage |
Revenue forecast, company share, competitive landscape, growth factors, and trends |
Segments Covered in the Report:
This report forecasts revenue growth at global, regional, and country levels and provides an analysis of the latest industry trends and opportunities in each of the sub-segments from 2020 to 2030. For the purpose of this study, has segmented the global trade finance market is segmented based on the product type, services providers, application, and region.
Global Trade Finance Market, By Region:
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- North America
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- U.S.
- Canada
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- Europe
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- Germany
- UK
- France
- Russia
- Italy
- Rest of Europe
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- Asia Pacific
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- China
- India
- Japan
- South Korea
- Rest of Asia Pacific
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- Latin America
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- Brazil
- Mexico
- Rest of Latin America
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- Middle East & Africa
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- GCC
- Israel
- South Africa
- Rest of Middle East & Africa
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- North America
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Global Trade Finance Market Key Players
The major key players in the market include Banco Santander SA, Bank of America Corp., BNP Paribas SA, Citigroup Inc., Agricole Group, Goldman Sachs Group Inc., HSBC Holdings Plc, JPMorgan Chase & Co., Morgan Stanley and Wells Fargo & Co.
Bank of America Corp
The Bank of America Corporate Center is a skyscraper in Uptown Charlotte, North Carolina, that stands at 871 feet (265 meters). It was the tallest skyscraper in Charlotte and North Carolina when it was completed in 1992; it stands 60 floors tall. It is the world's 174th highest structure. It is the 31st tallest skyscraper in the United States and the most well-known structure in the Charlotte skyline, designed by Argentine architect César Pelli and HKS Architects. It is best recognized as Bank of America's global headquarters.
Global Trade Finance Market Company Profile
- Banco Santander SA
- Company Overview
- Product Portfolio
- Key Highlights
- Financial Performance
- Business Strategies
- Bank of America Corp.
- Company Overview
- Product Portfolio
- Key Highlights
- Financial Performance
- Business Strategies
- BNP Paribas SA
- Company Overview
- Product Portfolio
- Key Highlights
- Financial Performance
- Business Strategies
- Citigroup Inc.
- Company Overview
- Product Portfolio
- Key Highlights
- Financial Performance
- Business Strategies
- Agricole Group
- Company Overview
- Product Portfolio
- Key Highlights
- Financial Performance
- Business Strategies
- Goldman Sachs Group Inc.
- Company Overview
- Product Portfolio
- Key Highlights
- Financial Performance
- Business Strategies
- HSBC Holdings Plc
- Company Overview
- Product Portfolio
- Key Highlights
- Financial Performance
- Business Strategies
- JPMorgan Chase & Co.
- Company Overview
- Product Portfolio
- Key Highlights
- Financial Performance
- Business Strategies
- Morgan Stanley
- Company Overview
- Product Portfolio
- Key Highlights
- Financial Performance
- Business Strategies
- Wells Fargo & Co.
- Company Overview
- Product Portfolio
- Key Highlights
- Financial Performance
- Business Strategies
Global Trade Finance Market Table of Contents
- Research Objective and Assumption
- Preface
- Research Objectives
- Study Scope
- Years Considered for the study
- Assumptions
- Abbreviations
- Research Methodology
- Research data
- Primary Data
- Primary Interviews
- Primary Breakdown
- Key data from Primary Sources
- Key Thickness Insights
- Secondary Data
- Major Secondary Sources
- Secondary Sources
- Market Estimation
- Top-Down Approach
- Approach for estimating Market Share by Top-Down Analysis (Supply Side)
- Bottom-Up Approach
- Approach for estimating market share by Bottom-up Analysis (Demand Side)
- Market Breakdown and Data Triangulation
- Research Assumptions
- Market Purview
- Executive Summary
- Key Findings—Global Outlook for Trade Finance Strategies
- Key Questions this Study will Answer
- Market Snippet, By Product Type
- Market Snippet, By Services Providers
- Market Snippet, By Application
- Market Snippet, By Region
- Opportunity Map Analysis
- Executive Summary—3 Big Predictions
- Market Dynamics, Regulations, and Trends Analysis
- Market Dynamics
- Drivers
- Restraints
- Market Opportunities
- Market Trends
- DR Impact Analysis
- PEST Analysis
- Porter’s Five Forces Analysis
- Opportunity Orbit
- Market Investment Feasibility Index
- Macroeconomic Factor Analysis
- Market Dynamics
- Global Trade Finance Market, By Product Type, 2019 – 2025, (US$ Mn)
- Guarantees
- Market Value and Forecast (US$ Mn), and Share Analysis (%), 2019 – 2025
- Y-o-Y Growth Analysis (%), 2019 – 2025
- Segment Trends
- Letter of Credit
- Overview
- Market Size and Forecast (US$ Mn), and Y-o-Y Growth (%), 2019 – 2025
- Documentary Collection
- Overview
- Market Size and Forecast (US$ Mn), and Y-o-Y Growth (%), 2019 – 2025
- Supply Chain Finance
- Overview
- Market Size and Forecast (US$ Mn), and Y-o-Y Growth (%), 2019 – 2025
- Others
- Overview
- Market Size and Forecast (US$ Mn), and Y-o-Y Growth (%), 2019 – 2025
- Guarantees
- Global Trade Finance Market, By Services Providers, 2019 – 2025, (US$ Mn)
- Banks
- Market Value and Forecast (US$ Mn), and Share Analysis (%), 2019 – 2025
- Y-o-Y Growth Analysis (%), 2019 – 2025
- Segment Trends
- Trade Finance Houses
- Overview
- Market Size and Forecast (US$ Mn), and Y-o-Y Growth (%), 2019 – 2025
- Dry Electrotransfer
- Overview
- Market Size and Forecast (US$ Mn), and Y-o-Y Growth (%), 2019 – 2025
- Tank Electro transfer
- Overview
- Market Size and Forecast (US$ Mn), and Y-o-Y Growth (%), 2019 – 2025
- Others
- Overview
- Market Size and Forecast (US$ Mn), and Y-o-Y Growth (%), 2019 – 2025
- Banks
- Global Trade Finance Market, By Application, 2019 – 2025, (US$ Mn)
- Energy
- Market Value and Forecast (US$ Mn), and Share Analysis (%), 2019 – 2025
- Y-o-Y Growth Analysis (%), 2019 – 2025
- Segment Trends
- Finance
- Overview
- Market Size and Forecast (US$ Mn), and Y-o-Y Growth (%), 2019 – 2025
- Transport
- Overview
- Market Size and Forecast (US$ Mn), and Y-o-Y Growth (%), 2019 – 2025
- Power Generation
- Overview
- Market Size and Forecast (US$ Mn), and Y-o-Y Growth (%), 2019 – 2025
- Healthcare
- Overview
- Market Size and Forecast (US$ Mn), and Y-o-Y Growth (%), 2019 – 2025
- Metals and Non Metallic Minerals
- Overview
- Market Size and Forecast (US$ Mn), and Y-o-Y Growth (%), 2019 – 2025
- Renewables
- Overview
- Market Size and Forecast (US$ Mn), and Y-o-Y Growth (%), 2019 – 2025
- Others
- Overview
- Market Size and Forecast (US$ Mn), and Y-o-Y Growth (%), 2019 – 2025
- Energy
- Global Trade Finance Market, By Region, 2019 – 2025, (US$ Mn)
- Overview
- Market Value and Forecast (US$ Mn), and Share Analysis (%), 2019 – 2025
- Y-o-Y Growth Analysis (%), 2019 – 2025
- Regional Trends
- North America
- Market Size and Forecast (US$ Mn), By Product Type, 2019 – 2025
- Market Size and Forecast (US$ Mn), By Services Providers, 2019 – 2025
- Market Size and Forecast (US$ Mn), By Application, 2019 – 2025
- Market Size and Forecast (US$ Mn), By Country, 2019 – 2025
- U.S.
- Canada
- Europe
- Market Size and Forecast (US$ Mn), By Product Type, 2019 – 2025
- Market Size and Forecast (US$ Mn), By Services Providers, 2019 – 2025
- Market Size and Forecast (US$ Mn), By Application, 2019 – 2025
- Market Size and Forecast (US$ Mn), By Country, 2019 – 2025
- Germany
- UK
- France
- Russia
- Italy
- Rest of Europe
- Asia Pacific
- Market Size and Forecast (US$ Mn), By Product Type, 2019 – 2025
- Market Size and Forecast (US$ Mn), By Services Providers, 2019 – 2025
- Market Size and Forecast (US$ Mn), By Application, 2019 – 2025
- Market Size and Forecast (US$ Mn), By Country, 2019 – 2025
- China
- India
- Japan
- South Korea
- Rest of Asia Pacific
- Latin America
- Market Size and Forecast (US$ Mn), By Product Type, 2019 – 2025
- Market Size and Forecast (US$ Mn), By Services Providers, 2019 – 2025
- Market Size and Forecast (US$ Mn), By Application, 2019 – 2025
- Market Size and Forecast (US$ Mn), By Country, 2019 – 2025
- Brazil
- Mexico
- Rest of Latin America
- Middle East & Africa
- Market Size and Forecast (US$ Mn), By Product Type, 2019 – 2025
- Market Size and Forecast (US$ Mn), By Services Providers, 2019 – 2025
- Market Size and Forecast (US$ Mn), By Application, 2019 – 2025
- Market Size and Forecast (US$ Mn), By Country, 2019 – 2025
- GCC
- Israel
- South Africa
- Rest of Middle East
- Overview
- Competitive Landscape
- Heat Map Analysis
- Market Presence and Specificity Analysis
- Company Profiles
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- Banco Santander SA
- Company Overview
- Type Portfolio
- Key Highlights
- Financial Overview
- Business Strategies
- Bank of America Corp.
- BNP Paribas SA
- Citigroup Inc.
- Agricole Group
- Goldman Sachs Group Inc.
- HSBC Holdings Plc
- JPMorgan Chase & Co.
- Morgan Stanley and Wells Fargo & Co.
- Banco Santander SA
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- The Last Word
- Future Impact
- About Us
- Contact
FAQs
The Trade Finance Market report segments the market been segmented on the been segmented on the basis of product type, services providers, application, and region.
The development of technologies such as optical character recognition (OCR) to read container numbers, radio frequency identification (RFID) and quick response (QR) codes to identify and trace shipments, blockchain, and enhancing digitization of trade documents drive the trade finance market growth.
Europe is expected to grow at the fastest growth rate during the forecast period
The leading players operating in the Trade Finance Market includes Banco Santander SA, Bank of America Corp., BNP Paribas SA, Citigroup Inc., Agricole Group, Goldman Sachs Group Inc., HSBC Holdings Plc, JPMorgan Chase & Co., Morgan Stanley and Wells Fargo & Co.