The impact of regional and global economic and political factors on trade volumes was the subject of much discussion during 2019. In the UAE, trade volumes declined as a result of a fall in imports of goods such as automobiles and retail goods.
However, at ADCB we have managed to grow our trade finance business over the last few years by expanding our focus across various markets for strategic trade flows. In the past we were very much focused on UAE and regional business, but since 2017 through our representative offices we have tapped into markets in Asia Pacific and across the Indian sub-continent, following our key clients.
Large commodity firms are well aware of the benefits of trade finance and we don’t deal with those further down the supply chain because of the heightened risk. As a bank, we offer electronic presentation of documents, which reduces turnaround times for clients in terms of delivering their documents to buyers.
Clients are primarily interested in products that extend their working capital cycle, allowing them to borrow under letters of credit by exchanging payment terms while improving their balance sheet management. We are also seeing increasing demand for reverse factoring, with clients reducing risk by ensuring they are transparent in their financial reporting.
In September 2019, ADCB became the first bank in the UAE to run an end-to-end blockchain trade finance transaction with full document automation through the dltledgers platform, offering corporate customers greater confidentiality, the ability to keep a closer tab on the flow of the goods and documentation, faster turnaround and enhanced fraud prevention