The Global Invoice Exchange
The Global Invoice Exchange (GIX) is a DeFi platform that enables businesses around the world to sell validated, receivable invoices to unlock critical working capital. At the same time, GIX offers Liquidity Providers the opportunity to invest in a multi-trillion dollar asset class.
Built on Web 3.0 technology and powered by TVM$ (our native token), GIX operates as a bridge between DeFi & SMEs to provide access to a potentially unlimited liquidity pool and help close the trillion-dollar global trade finance gap.
GIX brings benefits to all participants on the platform:
GIX empowers SMEs to sell validated receivable invoices, on a secure platform, to immediately unlock critical working capital that help manage cash flow and liquidity.
Buyers will enjoy full or extended payment terms, earn additional interest (through staking) to offset invoices, and secure their supply chain.
GIX opens the door to a world of opportunities and provides sophisticated and financially-savvy liquidity providers with a rare opportunity to invest in a previously inaccessible, multi-trillion dollar Real World Asset class.
A $1.7 trillion Global Problem
A recent Asian Development Bank study estimated that the global trade finance gap stood at $1.7 trillion in 2020. The long term impact of supply chain disruptions from the COVID-19 pandemic, alongside geopolitical events such as the Russia-Ukraine war, are expected to exacerbate the situation further and widen the gap to $2.5 trillion by 2025 (WEF).
What is the Trade Finance Gap?
The trade finance gap represents the financing that banks & financial institutions were unwilling or unable to provide to SMEs. In other words, it is the total amount of financing requested by SMEs, that were rejected by the financial industry for various reasons, including the lack of historical data, high administrative costs of processing and low quantum of financing.
SMEs: The Backbone of Global Economies
Small and Medium-sized Enterprises (SMEs) play a crucial role in keeping the global economy turning. SMEs account for around 90% of companies and more than half of the jobs worldwide according to the World Bank. However, it is often these SMEs that are underserved and lack access to affordable trade finance.
During a typical business transaction, the SME delivers goods and services and, at the same time, issues an Invoice to the Buyer. Payment terms range from 30 days to 90 days, and sometimes 120 to 180 days. These long payment cycles, especially for cross-border transactions, can place tremendous strain & pressure on working capital reserves.
Accessibility to trade finance is important since it allows SMEs to manage risk and liquidity challenges. Both importers and exporters face counterparty and currency risks while engaging in trade. This is even more pronounced for SMEs with limited resources. Further, there are long payment cycles especially for cross-border transactions, which can strain working capital reserves. While trade finance instruments address these challenges, a significantly large number of SMEs face obstacles in accessing them.
While they have traditionally filled the trade time gap, banks and financial institutions do not have the capacity to absorb the current growing trade finance demand due to increasing compliance constraints and regulatory requirements.