MANILA, Jan. 9 (Xinhua) -- The Asian Development Bank (ADB) signed Thursday an agreement with Standard Chartered Bank to support supply chain financing and boost the development of small and medium enterprises (SMEs) in Asia.
The agreement is expected to finance more than 800 million U.S. dollars in supply chain transactions, most of which will be directed through SMEs that are supplying large companies with materials for intermediate and final production.
Under the deal, the Manila-based lender and the United Kingdom- based bank will share the risk in the transactions. ADB said this will support the development of intra-Asia supply chains as well as supply chains between Asia and other regions of the world.
"Market gaps for supply chain finance impede economic growth and job growth, so it is imperative that ADB gets into this space, " said ADB's Head of Trade Finance Steven Beck said in a statement.
The partnership is the first of its kind under ADB's recently launched Supply Chain Finance (SCF) program. The SCF, which complements ADB's Trade Finance Program, will take commercial corporate risk and is expected to improve liquidity within the supply chains.