- Focus Areas
From Global Trade Review (GTR) | By Sanne WassA new industry organisation has been launched to create a global voice and community for those involved in open account receivables finance around the world. Under the name World of Open Account (WOA), its mission is to be a “global collaborative competence centre for more, better and safer receivable financing”. It was founded and is run by Erik Timmermans, together with eight founding companies and with support from eight strategic advisors. Timmermans has worked in the receivables financing space for decades. He was secretary general at IFG (International Factors Group – a global trade association for factoring) from 2005 to 2015 and played a key role in the merger between IFG and FCI in late 2015. Speaking to GTR, he says that, over the years, he has seen a great need for a more accessible, peer-to-peer environment where professionals in receivables finance can network and share knowledge. This is where Timmermans sees WOA playing a role. He insists that it “is not an association, it’s a community”, and that it focuses on “a number of things that associations try to do but not always well: connecting people”. That’s why he is ditching the top-down approach of traditional associations in favour of a peer-to-peer structure, which is primarily run through digitally-driven initiatives (including webinars and other online offerings) to achieve as wide a reach as possible. One key element will be an online database of individual professionals, bank and non-bank financiers, service providers and other stakeholders, which can be used as a forum to discuss issues and ask for advice, knowledge and support. It is also hoped that firms looking for working capital solutions will engage in the project as well. “It should not just be a better phone book or LinkedIn group for the world of receivables finance, it should go beyond that,” Timmermans says. WOA will also work as a platform for community expert groups, something Timmermans believes will be the “backbone of the organisation”. The aim behind these groups is to bring new product and market ideas, as well as new technology, to the community. One example he mentions as an obvious area for expert groups to emerge around is blockchain. “There are a number of initiatives going on, but there is still a very big issue in getting feedback from the market. Once we have a community, members could create a community expert group for blockchain solutions for investing in receivables or factoring. They will work together, maybe create a survey, and that can lead to very quick feedback,” he says. The website and app will go live by the end of the year. Membership will be based on a so-called ‘freemium model’, whereby it will be free to sign up and use basic services, while more advanced features will be subject to a membership fee. The launch comes amid a global move away from traditional trade finance instruments towards more open account trading, which has created a growing need for new financing solutions. Meanwhile, the trend of unmet demand for trade finance continues. In a recent survey conducted by the ICC Banking Commission, 61% of banks perceived that there is more demand for trade finance than there is supply, while 80% expected little or no growth in traditional tools like the letter of credit. “If WOA is successful, in a few years from now, it’s not only about the number of individuals and companies who will be involved in the community, but it will definitely have contributed to an increase in open account, and that can be domestic or international business, and more receivables financing,” Timmermans ends. The post Industry veteran launches receivables finance community appeared first on Global Trade Review (GTR).