State Street Bank's three-month-old online open account trade management system, i2eX, will integrate with ecVision's online electronic document management software to provide large retailers and brand manufacturers with trade finance, online.
The integrated platforms will enable companies that source internationally to initiate a purchase order electronically via ecVision's electronic document platform, use the purchase order data to create an electronic letter of credit on i2eX, and finally to initiate a payment.
The alliance, according to Patrick Ho, vice president and regional manager at State Street Bank, Hong Kong, will represent a "tremendous opportunity" for the bank to tap into and provide trade finance to ecVision's customer base which includes companies such as JCPenney and GAP.
ecVision's supply chain management program will partially eclipse i2eX's functionality, as companies will be using ecVision to create and manage trade orders, also a service provided by i2eX. However, Ho says that the two systems are entirely complimentary and there has been no change in the bank's business model to provide a comprehensive end-to-end electronic platform. ecVision provides an alternative platform for customers to initiate the trade, he explains.
Ho says that in the three months that i2eX has been running in Asia, there has been much interest in the system, signing up manufacturing giants such as Yue Yuen and Thailand's Pou Chen. Corporations using the i2eX system can expect to save at least 50% on the cost of a letter of credit, says Ho.
ecVision's platform seeks to utilize the internet as a cheaper alternative for the exchange of trade data and documents. BoBo Kwan, regional consulting manager of ecVision, explains that some 80% of suppliers in Asia are small to medium enterprises that cannot afford electronic data interchange (EDI), a messaging system for data exchange. The ecVision platform takes EDI messages from large manufacturers and converts them into XML format, a commonly used language over the internet. Suppliers are then able to receive the messages via an internet connection.
The integrated platform formed by State Street and ecVision is expected to begin operations in the first quarter of this year.
