TradeCard and Innovative Trade Services partnership targets central American banks
07 June 2006 | 1406 views | 0
TradeCard Inc., the leading provider of on-demand supply chain automation products, announced today that it has partnered with Innovative Trade Services Corp. (ITS) to develop a fund comprised of Central American banks and other financial institutions to offer pre- and post export financing to TradeCard members in CAFTA-DR countries, which include Nicaragua, Honduras, Guatemala, Dominican Republic and El Salvador.
ITS will manage the fund - the Central American Fund for Trade (CAFTrade). The partnership supports the ongoing growth of Central American trade by providing financial services and a technology platform for secure, automated transactions with buyers and suppliers located outside the region and throughout the world.
The deal with ITS positions TradeCard for growth in the CAFTA-DR region, the second largest U.S. export market in Latin America. TradeCard's strategy for automating the flow of cash and goods in Central America follows success and momentum TradeCard has achieved in the Far East and Indian Subcontinent. TradeCard supports global trade transactions for more than 2000 members, reaching suppliers in over 40 countries and speaking 32 languages. The TradeCard Platform processes over $500 million in transactions monthly and is expected to settle $6 billion in global trade flows this year.
ITS and several regional banks will fund the first wave of transactions. ITS is in the process of creating a full consortium of financial institutions that will comprise CAFTrade. The fund's focus will be to finance the largest component of trade between the U.S. and Central America, the textile and apparel sector. ITS will manage the disbursement of trade finance proceeds across borders of Central American countries. The fund formed and managed by ITS will be the first of its kind to provide trade finance products within the TradeCard network.
"This is a prime opportunity for companies in CAFTA countries to be far more effective in managing their financial supply chains and to be competitive with companies in China and the Indian Subcontinent," said Kurt Cavano, CEO of TradeCard. "Working with ITS, we're expanding our presence in the region to enable more businesses to connect with exporters and importers across the globe. TradeCard's combined technology and financial services will increase supply chain speed, responsiveness and efficiency by offering direct access to competitive funding, a vast global trade network, and a local support team - all through an easy-to-use technology platform."
TradeCard has more than 20 export finance partners in Asia, including Hong Kong and India, but this is its first in Central America. TradeCard currently supports trade flow in seven countries in Central and South America.
"The recently enacted Central America Free Trade Agreement creates the legal and political framework for enhanced trade of goods and services in the Central American region," said Adolfo McGregor, President of ITS. "It is expected that the textile and apparel sector will have the greatest growth in terms of absolute values. ITS and TradeCard will enable textile and apparel buyers and suppliers in the region to obtain financing required to fill orders and grow their businesses."