Before the 24th of June many of us weren’t too worried about Brexit, but a lot has changed since that date. Apart from the revolving door of UK political leaders and the stock market turbulence after the event, most people might think that things have started to return to normal. For the citizen in the street this certainly seems to be the case. The focus is back to the football results and what strange things the ‘Special One’ and the ‘Ordinary One’ might be up to.
In the supply chain finance (SCF) world, things have certainly changed as a result of Brexit. While Britain’s decision to leave the EU is unlikely to change how SCF works or its advantages to both suppliers and buyers, some bankers are clearly nervous. In a recent request for information (RFP) process that I was running, four banks participated in a bid to run the SCF programme of a eurozone company; one was a prominent British bank. As the result of the EU referendum neared, I was asked whether the UK leaving the EU should have an influence over the bid award decision.
When I questioned a bit deeper it appeared that the client was anxious about how British banks might weather the Brexit storm and whether this would affect their long term ability to fund the facility. I’m sure that the banks – and plenty of economists – would say that there is nothing to worry about – but aren’t these the same people who didn’t think Brexit would happen?
If there is one thing we have learned from the British referendum it is that anxious people can make unexpected decisions.
Brian Shanahan is the leader and founder of Informita and Termscheck.com