Green trade finance goes digital to help SMEs operate efficiently and sustainably
Easy access to green financing
By leveraging existing digital data available on Doxa Connex, Kimly can also access green and sustainable business financing from UOB Bank without additional paper documentation.
Mr. Edmund Ng, co-founder and CEO of Doxa, shares that the platform uses blockchain technology to help verify documents. “In this way, Doxa Connex provides financial institutions with a single source of data truth and greater transparency.”
For example, once a purchase order is generated, the data will be encrypted in the blockchain and will be part of an immutable database, which means that it cannot change, be modified or deleted.
“There is no way for anyone to delete or manipulate data that is already on the blockchain, and it makes it easy to prove that the transaction in question is genuine,” says Ng, 46.
Construction companies will be able to validate invoices from their suppliers or sub-contractors on Doxa Connex, and their requests for commercial financing will be automatically triggered and transmitted to the UOB. This reduces the need for the company to send physical copies of relevant documents to UOB branches for verification.
Ms. Ng Poh Yee, General Manager of UOB and Head of Corporate Commercial Sales and Financial Supply Chain Management, adds: “From a finance perspective, we need the same proof of order, delivery and acceptance of the underlying commercial contract between our client and its suppliers. .”
Before it was digitized, clients had to collect and submit these documents from various internal and external parties to UOB for verification. The bank also requires a copy of the same documents.
“This duplication means that the paper flow is actually doubled because UOB would have had to separately and individually verify the authenticity of each transaction, which lengthens the processing time to qualify for the required funding,” says Ms Ng, 50.
“But with Doxa Connex, we no longer have to because our client can easily digitally submit supporting business documents relevant to financing to us, making the process secure, fast and cost effective.”
When it comes to finance in the construction industry, suppliers, contractors and sub-contractors are often underserved, says Ng.
“Especially for green and sustainable trade finance, most of them do not have the framework to prove that they meet certain sustainability standards. They also may not be fully aware of the financing options that arise. offer to them,” she said.
Using a single source of truth in Doxa Connex to verify supporting documentation solves this problem, allowing UOB to fund not only Kimly, but all stakeholders in Kimly’s value chain.
With sustainability being a key objective for the UOB Group, the bank launched its Green and Sustainable Trade Finance Framework last year. It has been designed to provide companies with a clear guide to assessing eligible green activities and industry-recognized certifications in targeted sectors.