Trade and Supply Chain Finance Program (TSCFP)
TSCFP works to make global trade and supply chains green, resilient, inclusive, transparent, and socially responsible.
The TF business of ADB's Trade & Supply Chain Finance Program (TSCFP) fills market gaps for trade finance by providing guarantees and loans to banks. TF continues to grow, supporting billions of dollars of trade throughout the region, which in turn helps create sustainable jobs and economic growth in Asia’s developing countries.
In 2023, TSCFP’s trade finance business supported 21,416 transactions worth a total of $4.7 billion, including $2.9 billion in co-financing. TSCFP’s work helped 6,900 small and medium-sized enterprises and enabled 1,300 transactions between ADB Developing Member Countries.
Trade finance works exclusively through banks. The reason for this is two-fold:
ADB issues a CG in favor of confirming bank covering up to 100% of issuing bank risk within 24 hours of request. More than 75% of Trade Finance Program's portfolio is generated through this product.
Guarantee to a bank in Germany covering 100% of a $600,000 payment risk on an Azerbaijan bank supporting import of fruit and vegetable drying equipment.
ADB provides loans directly to issuing banks in Trade Finance Program countries of operation to support pre-shipment and post-shipment trade transactions.
$250,000 trade loan to a Sri Lanka bank to on-lend pre-export finance for the manufacture of garments for export to Europe and India.
ADB enters into a risk distribution agreement with insurers, export credit agencies, and other entities developing credit appetite in Trade Finance Program countries distributing and sharing issuing bank risk with them to leverage capital resources and credit limits.
Cofinance and share risk with distribution partners in all TFP countries.
TF is open to qualified banks located in ADB’s developing member countries. There are no fees to join the program. Eligible issuing banks should sign an Issuing Bank Agreement.
The qualification criteria to be an issuing bank include:
Advantages in joining TF as an issuing bank include:
Confirming banks are in a key position to support more business for exporting clients, especially in countries where credit lines are limited.
TF is open to qualified international, regional, and local banks worldwide. Interested banks are required to provide information on their anti–money-laundering (AML) and know-your-client (KYC) policies. Eligible confirming banks should sign a Confirming Bank Agreement. There are no fees to join.
Advantages in joining TF as a confirming bank include:
value of transactions supported
transactions supporting SMEs