When Intesa Sanpaolo Group announced last week that it had teamed up with Orbian to create a new supply chain finance platform, it filled a growing need for the bank’s corporate clients.
“Some of the first feedback we have been getting back from the market is that finally, we can have a solution that integrates the Italian market with the international market”, says Stefano Favale, head of global transaction banking at the bank. “The Italian market is very regulated, and many programmes couldn’t on-board Italian suppliers and international suppliers.”
In a statement released when the Orbian deal was announced, Favale described the potential of supply chain finance in Italy as “still largely untapped, ” but this is not a new area for the Italian bank. It had already set up its own ‘confirming’ supply chain finance online solution to support around 300 domestic clients and their Italian suppliers, but as Italian corporates become more internationally focussed, something different was needed.
With Orbian’s technology, the bank’s original solution can be bridged with a new Orbian-powered platform that allows international suppliers to the bank’s clients to also benefit from quicker access to credit by uploading invoices to the system.
Orbian was one of the first non-bank companies to pioneer supply chain finance solutions, having first launched in 1999, and its longevity and global presence was part of the reason the bank selected the tech firm as its partner, according to Favale.
“Today our client-buyers are not only operating on a domestic scale – but on an international scale, so it was necessary to expand our capabilities outside Italy. When we analysed the market, we decided that Orbian was the right partner for us as it has a coverage of more than 50 countries around the world,” he says.
At Orbian, chairman Thomas Dunn welcomes the chance to tap into the growing Italian market for supply chain finance. “As the third largest economy in the Eurozone and home to many of the world’s largest and most highly respected multinational corporations, Italy represents a very significant opportunity for the deployment of supply chain finance,” he says.
Back at Intesa Sanpaolo, Favale is in no doubt that the close integration with Orbian is the right way to address that opportunity. “The most important thing is to have just one entry point for all our clients,” he says. “They can access the platform and, once the receivables are uploaded, the domestic ones will be managed by Intesa directly, and the international ones will be managed by the Orbian platform.
“The buyer will only see one platform and one contact point but, behind that platform, we are able to manage Italian receivables for the Italian suppliers and international ones via Orbian,” he adds.
Intesa Sanpaolo will at first leverage off its existing portfolio of domestic clients already using its solutions, but its ambitions are bigger.
“The next step is to expand to international suppliers of the domestic Italian confirming clients while at the same time going out to our international clients and offering them an international solution,” Favale explains.
The bank is already putting together responses to RFPs issued by global corporates, something which would have been much more difficult before the Orbian partnership. As Favale puts it, “Our solution is a benefit for clients giving them worldwide coverage, including Italy. This places us in a strategic position in the supplier finance market.”