Allianz Trade joins APAC collaboration to address $20 billion working capital gap

More than eight in 10 failed businesses cite cash flow problems as a major factor

Allianz Trade joins APAC collaboration to address $20 billion working capital gap

Insurance News

By Kenneth Araullo

Allianz Trade in Asia Pacific has partnered with Bueno and Choco Up to introduce a buy-now-pay-later (BNPL) solution tailored for both B2B e-commerce and traditional sellers.

This initiative is a response to the significant cash flow challenges faced by businesses, a key factor in the failure of many enterprises. A study by US Bank indicated that 82% of failed businesses identified cash flow problems as a contributing factor.

In Southeast Asia alone, the working capital gap is estimated at US$20 billion. The partnership between Choco Up, Bueno, and Allianz Trade seeks to address this issue, aiming to boost the US$121 billion e-commerce industry in Southeast Asia.

In this partnership, Choco Up provides funding for Bueno’s BNPL platform, allowing e-commerce buyers up to 60 days of payment terms. Allianz Trade underwrites the process, creating an offering in Southeast Asia that benefits both buyers and sellers. Buyers can increase their inventory with favourable credit terms, while sellers can boost sales by offering credit terms to customers without any risk.

Choco Up’s success with the BNPL model includes a collaboration with a Hong Kong-based wholesale retailer, facilitating over 3,500 transactions and nearly US$2 million in financing. This approach integrates insurance for the capital issued and enables automated disbursement of funding for B2B e-commerce transactions, with approvals processed within 30 seconds.

The global B2B e-commerce market, already six times larger than B2C, is expected to grow at a compound annual growth rate (CAGR) of 22% until 2030 in the Asia Pacific region. The partnership between Choco Up, Bueno, and Allianz Trade is poised to contribute significantly to this growth, aiming to alleviate the funding challenges facing ASEAN SMEs.

“As part of our growth strategy, we are committed to supporting the rapidly growing B2B e- commerce space,” said Thomas Guyader, regional head of digital transformation for Allianz Trade Asia Pacific. “It is with great pride that we embark on this partnership. This new product has tremendous potential as global trade continues to evolve. With BNPL payments becoming a must-have for e-merchants, our solution will plug the working capital gap and help them attract more customers from different markets and grow their businesses.”

“With faster and more secure access to capital, the future of e-commerce has never been brighter. Our partnership today will now unlock the growth potential of thousands of businesses to expand their operations – even operate across borders and bring us closer to our vision of helping a million asset-light businesses grow,” said Choco Up CEO and co-founder Percy Hung.

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