The HSBC Holdings Plc. backs up a new technology startup that aims to connect small-scale and medium-scale manufacturers to the suppliers in the different parts of the world as a part of trade banking.
Serai is a Hong Kong based, wholly owned subsidiary of Europe’s biggest bank by assets. In the last week, formal operations of Serai started which grabbed the attention of HSBC. The HSBC Executive John Flint plans to invest about $15-$17 billion by 2020 to boost the growth of the company.
Vivek Ramachandran, Chief executive of Serai said, “Navigating international markets as a small-and-medium-sized company is still a nightmare. And the real pain point is business-to-business (transactions)”
Ramchandran worked previously at HSBC’s commercial banking unit for about three years. He added that the technology would attract HSBC’s trade banking client network globally, which would further expand the business and include more manufacturers and suppliers who are not yet the banking customers.
Ramachandran, Chief Executive of Serai quoted, “The idea is to create a platform where buyers and sellers come together”
According to the sources, Serai is the first non-banking technology startup invested by HSBC. This could help the London headquartered lender, which currently makes bulk of its revenue in Asia, gain more access to new clients.
Investments in new technology and trade business by the global banks are increasing.
However, the detailed investment plans of HSBC in Serai are not yet disclosed.
While on the other hand, Serai initially plans to lend small loan amount to the Hong Kong based small firms, in order to support their purchases and help them grow, and further plans include financing solutions and credit insurance later by third parties.
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