In the decade that followed the 2008 Global Financial Crisis, the world lived through an extraordinary period of monetary accommodation. Quantitative easing across advanced economies created what many called the era of “cheap money”—an extended cycle of low interest rates, compressed risk spreads and plentiful credit. That so called “Goldilocks” environment supported trade expansion, globalisation and corporate leverage, while keeping inflation at bay, on an unprecedented scale. But it also bred dependency: treasuries, investors and suppliers began to treat liquidity as a given, not a scarce resource. When the pandemic hit, fiscal stimulus collided with supply shocks, precipitated by the war in Europe, and inflation surged, forcing central banks to unwind more than a decade of accommodative policy. The result has been a world of costed liquidity—where money carries a price again, and where credit has become selective, data-dependent and risk-priced rather than abundant. Amid this transition, supply chain finance (SCF) has emerged as one of the most adaptive and resilient forms of working-capital funding. It sits at the intersection of trade, technology and trust—linking buyers, suppliers, banks and now a growing ecosystem of fintechs and private-credit funds. Its transformation from a narrow financial product into a multi-party liquidity framework mirrors the broader restructuring of global capital flows. From seller-centric factoring to buyer-led finance In the early years, supply chain funding revolved around supplier-initiated factoring and forfaiting. These were riskier and costlier structures because they relied on the supplier’s credit profile and lacked transparency into the buyer’s payment behaviour. The shift came when banks began developing buyer-led programmes—often called buyer-payable or approved payables finance. By anchoring financing on the buyer’s creditworthiness and verified invoices, these programmes reduced risk, improved pricing and strengthened supply-chain stability. Yap Tat Yeen, Head of Supply Chain Solutions at Maybank Singapore, has worked across this evolution since its inception, and notes that this move from seller-driven to buyer-anchored models, initially led by European and American banks, created the foundation for modern SCF. It coincided with the rise of open-account trade—now representing more than 85% of global merchandise flows—and marked a structural shift away from the documentary letters of credit that dominated traditional trade. Compared to twenty years ago, when documentary trade made up about 40% of total trade financing, it now accounts for only around 10%, having ceded ground to open-account trade and SCF, says Yap. Buyer-led SCF has since become the core architecture for managing liquidity, not only as financing but as assurance—ensuring that suppliers are paid, buyers maintain continuity and financiers can underwrite cash flows with visibility rather than collateral. The long cycle of cheap liquidity and the turn to costed capital The long cycle of cheap liquidity ended abruptly with the pandemic. Supply disruptions and fiscal aid triggered the sharpest inflation surge in a generation. By 2023, policy rates across major economies had risen by more than 500 basis points from their pre-COVID lows, turning liquidity from a commodity into a scarce, risk-priced asset. Although central banks began to ease again in 2025, the structural change may be irreversible. Liquidity is now costed. Treasuries are learning to treat cash as a strategic resource, not a given. This shift is reshaping corporate behaviour. Firms are re-engineering working-capital flows through treasury optimisation, deploying surplus cash in dynamic-discounting programmes and blending external funding sources via multi-funder platforms. Banks, constrained by capital rules, are prioritising verified, self-liquidating exposures, while private credit and fintechs step into higher-yield and riskier segments. The transition from cheap to selective liquidity has therefore elevated SCF from a funding technique into a strategic infrastructure of data transparency and trust. Drivers of the new supply chain finance landscape Six interlocking forces are propelling SCF’s next phase of growth and transformation. Costed liquidity: The world has moved from cheap to priced capital. Working capital now carries opportunity cost, compelling treasuries to measure efficiency in basis points. SCF offers predictability through visibility: funding anchored on validated invoices, predictable cash flows and short-tenor, self-liquidating exposures. Supply-chain reconfiguration: Global production diversification—the “China + 1” strategy—has redefined supply networks. Manufacturing has spread into Southeast Asia, India and the Middle East, creating multi-currency and multi-jurisdictional trade corridors that demand a common flexible, data-enabled financing. SCF gives buyers, suppliers and financiers a shared financing framework and helps build trust across these networks. And more Asian and regional banks are moving into this space too, leveraging their local currency clearing and settlement capabilities and understanding of regulatory requirements and counterparty risks. Heightened uncertainty: Geopolitical fragmentation, tariff regimes, logistics disruptions and regulatory changes have all increased risk premiums. In this context, SCF’s ability to assure liquidity continuity has become vital. The First Brands Group episode in the United States illustrates this. The company, a major automotive parts and services conglomerate, filed for Chapter 11 protection in 2025 after liquidity stresses triggered by tariff-related advance inventory purchases and excessive leverage. Though investigations are still unfolding, the case has exposed how weak visibility across financing structures can cascade into systemic risk. Over sixteen years, the company expanded aggressively through debt-financed acquisitions and convoluted special purpose entity-based corporate and financing structures. Two of its term loans were securitised into collateralised loan obligations (CLOs) sold to Jeffreys’ Point Bonita Capital and UBS’ O’Connor and Hedge Fund Solutions. Simultaneously, receivables were allegedly pledged—sometimes multiple times—to at least three working-capital platforms: Raistone, Evolution Credit and Katsumi Capital. This created an estimated $11.6 to $19 billion in liabilities, of which $2.3 billion in collateralised assets is unaccounted for, against $6 billion of annual revenue and $1.3 billion in earnings before interest, tax, depreciation and amortisation (EBITDA). The company reportedly had only $14 million in cash. More troubling says Yap is the discovery that proceeds from debtor collections were diverted from financiers, undermining the integrity of the cash-flow chain. Rates of 15%–18%, reported across some of these facilities, were not reflective of SCF’s short-tenor, self-liquidating nature but symptomatic of information asymmetry and opacity. It is a wake-up call for private-credit funds and non-deposit-taking financial institutions that have entered this space without sufficient data-driven monitoring. Technological enablement: Technology has revolutionised SCF visibility. Application programming interfaces (APIs) now connect enterprise resource planning (ERP) and treasury management systems (TMS), embedding financing directly into procurement and payment flows. Artificial intelligence (AI) automates trade-document checking, duplicate-invoice detection and transaction anomaly screening, while blockchain ledgers—especially in China—record invoices and receipts immutably, preventing double financing. These are reinforced by international frameworks such as the United Nations Commission of International Trade Law (UNCITRAL) Model Law on Electronic Transferable Records (MLETR) which give digital instruments legal recognition, but require the ongoing work of the International Chamber of Commerce (ICC) in promulgating its Uniform Rules on Digital Trade Transaction (URDTT) and Digital Standards Initiative (DSI), to drive adoption and interoperability between parties. Environmental, social and governance (ESG) integration: SCF is becoming a lever for sustainable sourcing. Despite political controversy—particularly the US administration’s pullback from certain green-policy linkages—corporates bound by Scope 3 emission reporting continue to use SCF to embed sustainability priorities and incentives in supplier networks, offering preferential pricing to verified, lower-carbon or socially ethical partners. Flexibility and versatility: SCF’s greatest strength is its ability to span the cash-conversion cycle end-to-end—from inventory and pre-shipment financing to purchase-order, payables and receivables finance, as well as its flexibility in funding, including multi-funder structures that now combine bank, corporate and investor capital within one platform, giving it resilience across rate cycles. Diversification of liquidity providers Liquidity no longer comes solely from banks. Today’s ecosystem includes fintech platforms, private-credit funds and even corporates financing their own supply chains. Banks remain indispensable for their balance-sheet strength and regulatory discipline. Fintechs bring digital onboarding, speed and analytics, while private-credit funds inject yield-seeking capital to serve underserved tiers. In Asia, Funding Societies, GXS Capital (formerly Validus) and Kilde are examples of fintech-driven working-capital platforms. They use transaction-level data to assess risk dynamically and attract institutional investors into small and medium-sized enterprise (SME) finance. Corporates employ systems like SAP Taulia and C2FO to deploy internal cash into supplier programmes. The challenge lies in ensuring transparency. The First Brands case illustrates what happens when opacity and over-layering undermine data integrity. In response, the industry is converging around registries and interoperable data frameworks. MonetaGo’s global duplicate-financing registry, adapted by the Association of Banks in Singapore (ABS) for its industry-wide Trade Finance Registry, China’s Linklogis’ blockchain verification system, and regulatory alignment under MLETR are strengthening confidence. Visibility and cross-validation are becoming prerequisites for participation in the liquidity chain. Deep-tier and data-verified inclusion SMEs remain underrepresented in SCF—accounting for less than 10% of participants in Asia—but technology is closing the gap. Singapore’s Peppol e-invoicing network now covers more than half a million entities and, combined with MLETR adoption, turns digital invoices into legally transferable financial assets. China’s integration of tax, e-invoice and financial reporting enables deep-tier financing, where funding extends beyond tier-1 suppliers to subcontractors and micro-enterprises. Platforms like Shenzhen based MicroConnect take this further by converting verified business revenue into daily revenue obligations (DROs)—tradable on a regulated exchange in Macau. This model, supported by high levels of data capture, at point of sale, and regulatory oversight, allows liquidity to reach businesses with no conventional collateral. Such models confirm a central truth: liquidity follows data. When commercial information becomes digital, verified and standardised, it can be financed in real-time. Collaboration and convergence towards the multi-funder model The next frontier for SCF lies in collaboration among banks, fintechs, corporates and private-credit funds. Banks bring trust, regulatory compliance and scale; fintechs offer innovation, origination and digital rails; corporates provide authentic transaction data; and investors contribute diversified capital. These players are not inherently competitors—they occupy different spaces along the risk-capital-return spectrum. Banks target rated, balance-sheet-based exposures; fintechs focus on automation, onboarding and origination; private credit assumes higher risk for higher yield. The multi-funder programme is the bridge between them, allowing exposures to be distributed across multiple liquidity pools. It creates a “win–win” framework where each participant finances what fits their risk appetite, ensuring continuity even when traditional balance sheets tighten. Collaborative models are already emerging. The enablers are interoperability and open connectivity. APIs and Open Banking frameworks integrate financing directly into enterprise systems, while new initiatives like MAS’ BLOOM, Swift’s shared ledger, ICC DSI and national MLETR implementations may eventually ensure cross-border legal recognition. AI now augments credit and fraud analytics, liquidity forecasting and ESG tracking, creating real-time visibility that underpins confidence across participants. The new architecture of working-capital liquidity The decade era of cheap credit has ended. What is emerging in its place is a networked liquidity ecosystem—selective, data-driven, transparent and multi-sourced. From buyer-led SCF to today’s convergence of banks, fintechs and private-credit funds, the transformation of working-capital finance reflects a deeper economic shift: from collateral-based trust to data-verified confidence. The First Brands Group case—still unfolding—illustrates the consequences of opacity, while innovations in deep-tier financing, multi-funder models and real-time data exchange show the potential for inclusion and resilience. In this emerging architecture, liquidity no longer depends on monetary abundance but on information integrity. As AI, blockchain and open-data standards redefine transparency, capital will flow not to the cheapest borrower but to the most visible, verifiable and trustworthy. The future of working capital, therefore, belongs to those who can make their data—and their trust—bankable.
