The International Finance Corporation (IFC), a member of the World Bank Group, and SMBC have announced a $500 million supply chain finance facility to widen access to affordable working capital for small and medium sized businesses in emerging markets.
Under the facility, credit is based on the financial strength of large buyers and not on the suppliers themselves, so smaller businesses can receive early payment on invoices at rates they could not reach alone. The first anchor buyer is a large food manufacturer in Latin America, and the model is built to take on more buyers across sectors and markets. IFC will commit up to $250 million in direct funding, with SMBC providing the other half on equal terms.
The two said IFC’s funded participation adds credit capacity that lets SMBC serve a broader range of suppliers, at longer tenors and higher volumes, than would be commercially viable without a development finance partner. The facility was structured through IFC’s Global Supply Chain Finance program, which has supported more than $3.8 billion in supplier finance transactions since its launch in 2023.
The partners presented the facility as more than a financing line. They pointed to a finance gap for micro, small and medium sized enterprises that runs into the trillions, and noted that many of these businesses are shut out of formal banking because they have no documented financial track record, not because they lack creditworthiness. By giving suppliers a verifiable history of transactions, starting with early payment within days of a buyer approving an invoice, the facility aims to provide immediate financing as well as the credentials to reach broader banking services over time.
Nathalie Louat, Global Director for Trade and Supply Chain Finance at IFC, said supply chain finance is among the most effective ways to put working capital in the hands of small businesses, and that working with SMBC lets IFC reach suppliers the market would not serve on its own.
“Supply chain finance is one of the most effective tools to put working capital directly in the hands of small businesses in emerging markets, quickly, affordably, and at scale. By partnering with SMBC and leveraging the creditworthiness of established buyers, we can reach suppliers that the market alone would not serve, giving them not just liquidity today, but the financial footing to grow their businesses and create jobs,” Louat said.
Priyamvada Singh, Global Head of Sales, Global Trade Finance at SMBC, said supporting resilient global supply chains is a key priority for the bank and that the partnership strengthens its ability to offer suppliers working capital solutions.
“Supporting resilient global supply chains is a key priority for SMBC. Our partnership with IFC enhances our ability to provide working capital solutions to suppliers, enabling them to manage liquidity more effectively, support business growth, and contribute to the stability and efficiency of global trade and supply chains,” Singh said.
For suppliers, early payment backed by a large buyer’s credit could mean cash within days of an invoice being approved, along with a transaction record they can show to other lenders. For SMBC, IFC’s funding could let it reach further down the supply chain than it would on its own, though neither party has named the buyer’s country, the pricing or a timeline for adding more buyers.
Digital Trade Outlook’s View: Supply Chain Finance
What stands out is how the facility is built around the buyer. Because credit rests on a large food manufacturer’s strength, the suppliers behind it, many of them small, can borrow at rates they could not get on their own, and the payment history that builds up becomes a record they can take to other lenders. That makes each new anchor buyer important, since it decides how many suppliers the facility can reach and in which markets.
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