The $70 billion plus turnover Swiss-based Glencore group – one of the world's largest diversified natural resources companies - has selected Bolero technology for the online automation of its Letter of Credit application process.
Bolero is the leading provider of secure financial supply chain solutions, and Glencore has worked initially with Bolero and Credit Suisse on the first phase of what will become a significant multi-bank financial supply chain automation initiative for the major Swiss organisation.
Glencore will deploy Bolero's powerful online technology to save time and cut costs by improving the speed, efficiency and accuracy of its Letters of Credit and Guarantees process. Bolero will also provide Glencore with a full audit trail, reducing its procure-to-pay and order-to-cash cycles, and eliminating the inaccuracies and delays due to manual entry.
Glencore will use the BoleroAdvise solution to speed time to order fulfilment by bringing all its outstanding Documentary Credit Advices on-line for electronic viewing, amending, printing and downloading, as well as the BoleroApply solution for the full automation of its Letter of Credit application process. The new Bolero solutions will step-by-step replace Glencore's existing electronic L/C carrier system and, with immediate effect, all its telex, fax and paper solutions - eliminating discrepancies, significantly reducing cost and introducing speed and efficiency into its Documentary Credit Advice process.
BoleroAdvise provides Glencore with a bank-neutral platform that supports full multi-bank operation, allowing the company's export business to receive all its Letter of Credit Advices in the same standard format. This will help Glencore to unlock real value from its financial supply chain through reductions in working capital, cash flow and accounts receivable, as well as lower cost bank financing. On the import side, BoleroApply's single user interface will provide Glencore with support for all their Letter of Credit applications, while electronic handling will remove the likelihood of manual errors, cutting errors and reducing rejection rates.
Glencore is focusing on using its financial strength to enhance the commercial potential of its assets in markets where it has a comprehensive understanding of what really influences value. According to a Glencore spokesperson: "Automating our Letter of Credit cycle with Bolero gives faster delivery of notifications, enhanced accuracy and an electronic audit trail – helping us to speed our time to order fulfilment and giving us the potential for accelerated cash-flow. Perhaps more significantly, the Bolero solution also gives Glencore a consolidated view of all our Letters of Credit, helping us to optimise our cash flow and maximise our credit line opportunities with all our different banks.
"Glencore also expects Bolero to provide some very practical benefits by helping to tighten up order-to-cash cycle, including freeing up working capital, reducing floats, opening up discounting possibilities, automating our accounts receivable cycle and releasing cash discounts for prompt payment," continued the spokesperson.
"As the first bank to work with Glencore on this important project, we've seen how enabling the electronic delivery of Letter of Credit Advices and Copies can give banks an excellent opportunity to enhance their service proposition for international trading customers such as Glencore," added Daniel Wyss, Director, Credit Suisse. BoleroAdvise provides Glencore with a powerful gateway to Credit Suisse; trade finance services offering, and its short implementation and roll-out cycle can help clients to achieve a rapid return on investment. Because BoleroAdvise and BoleroApply are scalable, future-proof and interoperable with a wide range of e-commerce and trade community platforms and applications, it also gives Credit Suisse an ideal platform to help develop their trade finance services business.
"This latest and very significant partnership is another sign of how forward-thinking companies such as Glencore are now driving standardisation through their financial supply chain and, as a consequence, are reducing paper in international trade," explained Bolero's CEO Arthur Vonchek. "Bolero uniquely gives them an opportunity to work closely with their multiple banks in an industry-supportive manner, unlocking real benefits while at the same time providing banks with a platform to help them shift from traditional trade finance to more valuable financial supply chain support services."