Supply Chain Finance: Contemporary Developments and Applications

This chapter explores the contemporary developments in supply chain finance (SCF), focusing on its evolution from traditional finance-centric models to network-oriented and FinTech-driven frameworks. SCF addresses fundamental challenges in supply chains, such as liquidity constraints, information asymmetry, and risk management, while fostering collaboration among buyers, suppliers, and financial institutions. By leveraging tools like reverse factoring, dynamic discounting, and inventory financing, SCF integrates financial, operational, and informational flows, creating a seamless ecosystem that supports both large corporations and small and medium-sized enterprises (SMEs). The chapter emphasizes the transformative role of FinTech in reshaping SCF practices through innovations like blockchain, artificial intelligence, and digital platforms. These technologies enhance transparency, expedite financial processes, and promote inclusivity, particularly for SMEs. The chapter also examines SCF’s strategic importance in global supply chains, highlighting its dual focus on resilience and sustainability. Through tailored solutions, SCF enables businesses to adapt to disruptions, share risks, and align financial incentives with sustainable practices. To contextualize these advancements, the chapter presents two cases from Asia which demonstrate how FinTech and bargaining power drive SCF adoption to enhance ecosystem efficiency. Together, these cases offer a deeper understanding of SCF’s adaptability, impact, and potential.