CX Daily: Taming the Wild West of China’s Supply Chain Finance

TOP STORY

SCF /

In Depth: Taming the Wild West of China’s supply chain finance

Tech behemoths Ant Group Co. Ltd., JD.com Inc. and Tencent Holdings Ltd., as well as automakers like BYD Co. Ltd., have muscled in on the low-profile but critical world of supply chain finance (SCF), the system of company IOUs that keeps the wheels of business turning.

Previously dominated by the country’s banks, SCF — which involves systems and technology that help businesses manage their cashflow to avoid liquidity problems and lower their financing costs — is now awash with electronic platforms. Many are owned by banks, but increasingly they are built independently by heavyweight enterprises such as BYD and state-owned grain giant COFCO Corp., and by third-party fintech companies.