Vayana TradeXchange (VTX), an International Trade Finance Services (ITFS) platform licensed by the International Financial Services Centers Authority (IFSCA) to operate on a GIFT city-based platform, has launched four cross-border trade finance services for MSMEs. Transactions have been executed. $71,000 a month, its CEO said. The platform is now eyeing $200 million worth of transactions in a year.
VTX, Vayana (IFSC) Pvt. Created and operated by Ltd., a 100% subsidiary of supply chain finance platform Vayana Network, is one of the four Indian entities to have received a license from IFSCA to operate the ITFS platform.
Of the four transactions involving Indian MSMEs, three are for exports to the US and the other to the UK. VTX, the auction-based electronic platform, enables sellers (exporters) and buyers (importers) across the globe to avail a variety of trade finance products that help them address their trade receivables and payables This results in better management of cash flow.
“Through this platform, exporters and importers will get timely access to trade finance across geographies, opening up avenues for new business opportunities. With funds available in the currency of the trade, Kalyan Basu, MD & CEO, Vayana Tradeexchange Rates are discovered through a transparent bidding mechanism.”
Mr Basu was speaking during the Vayana Tradeexchange roadshow organized in association with integrated regulator IFSCA at Gujarat International Finance Tec-City – International Financial Services Center (GIFT-IFSC).
“So far, we have done four transactions involving MSMEs for exports. Not much to brag about yet, but we have started our journey. This is a completely new concept where the full value of the rebate will be through a bidding process.
“Another uniqueness of the platform is that it is not constrained by geography or sector or what kind of customer. MSMEs, non-MSMEs, big, small, big whoever they are can come on this platform.
Vayana plans to offer different products for exporters and importers. In the first phase, it will undertake India-centric transactions, which means, exporters will be in India for export transactions, and importers will be in India for import transactions. This phase will be run for six to seven months to ensure that the platform’s processes are in place, everything is running smoothly and there are enough transactions to carry it out, Mr. Basu explained.
Mr Basu said the company would then expand to other Asian countries such as Vietnam, Indonesia, Malaysia and others and then to the Middle East.
While the company has executed transactions worth $71,000 in its first month of operations, Mr Basu said the company expects to complete the first year with a total transaction value of around $200 million.
“This is a new business. Once the processes are accepted by the participants we expect it to grow really fast and it also depends on many other factors like how many foreign factors we can incorporate, And how quickly Indian factors can tie up with insurance companies and transact,” he said.
VTX has so far onboarded State Bank of India, Yes Bank, India Factoring, Volofin and Drip Capital as financiers and envisages on-boarding another 10 financiers soon.