What Is Payment Tokenization And How Does It Work?

The term payment tokenization is being used in abundance for the last few months. It is a complicated process that helps to protect our sensitive data. It is kind of like purchasing tokens at a casino in exchange for money to play at the slot machines. A similar system works here as well.

Wish to know more? Then read on as we explain what payment tokenization is, how it works in general, and for the commonly-used payment apps. So let’s get started!

What Is Payment Tokenization? 

To put it simply, the term "tokenize" refers to the act of substituting or transforming something into something else. Credit card tokens are used to replace sensitive data (such as a customer's credit card number, address, or account number) with a series of algorithmically generated digits and letters. Merchants can transport data between networks using credit card tokenization without revealing customers' sensitive information.

The "token" is a series of randomly generated integers that replaces the customer's primary account number (PAN). These tokens can then be transmitted across the internet or various wireless networks to complete the transaction without exposing actual bank information. In a secure token vault, the actual bank account number is kept safe.

Now that we know what payment tokenization means, let’s see how it works. 

How Does It Work?

Tokenization replaces sensitive client data with a one-time alphanumeric ID that has no value and is unrelated to the account's owner. Customers' credit card information is safely accessed, passed, transmitted, and retrieved via this randomly generated token.

Tokens do not include any personally identifiable information about customers. They're more like maps that show where the customer's bank stores sensitive data on their systems. Tokens are created using mathematical processes and are irreversible. Only after the transaction is complete can the tokens be opened. These tokens have no significance or value outside of your system. So even if hackers get their hands on your information while it's being processed, they won't be able to use it.

Originally Posted: https://www.emeriobanque.com/blogs/what-is-payment-tokenization-and-how-does-it-work

The Global Letter of Credit Confirmation Industry is Expected to Reach $4.5 Billion by 2027

According to a report named “Global Letter Of Credit Confirmation Market (2022-2027) by Type, End-User, Geography, Competitive Analysis and the Impact of Covid-19 with Ansoff Analysis”, the Global Letter Of Credit Confirmation Industry is evaluated to be USD 3930 Mn in 2022 and it is expected to touch USD 4551.53 Mn by 2027, developing at a CAGR of 2.98%.

Market elements are powers that influence the prices and behavioral patterns of the Global Letter of Credit Confirmation industry stakeholders. These elements indicate fluctuation in prices resulting from the changes in supply and demand curves for a certain product or service. The elements of industry dynamics can be related to macroeconomic and microeconomic factors. There are dynamic market powers other than price, demand, and supply ie. human emotions, they can also lead changes in decision-making, affect the market, and develop price indications.

As the market elements affect the supply and demand curves, the market leaders strive to figure out the best way to utilize a line of financial tools to structure several strategies for accelerating development and decreasing the risks.

Market Classification

• The Global Letter Of Credit Confirmation industry is divided based on its Type, End-User, and Geography.

• In terms of type, the market is divided into Slight LCs and Usance LCs.

• In terms of End Users, the market is classified into Small, Medium & Large organizations.

• When it comes to division Geographically, it has parted into Americas, Europe, Middle-East & Africa, and Asia-Pacific.

Organizational Profiles

The report delivers a deep inspection of the competitors in the industry. It covers the financial execution analysis for the publicly listed organizations in the industry along with deep data on their recent growth and competitive situation. Some of the organizations included in this aforesaid report are Bank of - America Corporation, CapitalOne Corporation, CoBank, Citigroup Inc., DBS Bank Ltd, PNC Financial Services Group, Inc., etc.

Originally Posted: The Global Letter of Credit Confirmation Industry is Expected to Reach $4.5 Billion by 2027

Top Benefits Of Using Online Banking Services

Gone are the days when a corporate had to visit the bank branch in-person for any type of banking-related work, for example, depositing a cheque, or withdrawing cash, transferring funds, etc. If your business is still lying on traditional banking, then you are wasting your time as well as business capital. It’s time to go for e-banking or we can say online banking, digital banking, a revolutionary & advanced platform to address all your banking-related needs anytime from anywhere.

Online banking is an efficient, easier, flexible & convenient way to save significant time & money that allows you to keep track of all of your cash in-flow & outflow at your fingertips. You don’t have to worry about a single thing. Plus, this enables you to shift your focus on other organizational goals to help the business expand & operate. Let’s check some of the top benefits of online banking for small businesses:

What is Online Banking?

Online banking is a digital platform where an individual can avail almost all services that a traditional bank offers. From managing your bank accounts to checking balance, international fund transfer, loan applications, payments of bills, deposits and transfer verifications, and many more. All can be done through a few clicks, there is no need to wander from one counter to another in person.

Benefits Of Online Banking Services For Small Businesses 

1. Anytime From Anywhere - The very first & foremost benefit of online banking is that you don’t have to wander through the long queues at the bank branches to get your work done. Just log into your online account and perform all your work without requiring any assistance. Be it checking balance, making investments & receiving payments, transferring funds internationally, or anything else. It is quite useful for small businesses who have busy schedules and can’t afford to be stuck in the traffic.  
   
   
2. Lower Costs - Another benefit of online banking is that it cuts back extra banking expenses & overheads for small businesses and saves money based on their requirements.     Corporates can capitalize money on automated tools such as Electronic Fund Transfers (EFT) for fast bill payments. In other cases, they can save on labor costs and become more productive.  
   
   
3. Protection Against Fraud & Errors - Online banking transactions are quite secure and offer a great degree of protection against errors, scams, & fraud especially in the case of trade finance services. Nowadays, people are getting more aware of the security of their data and information and thereby shifting towards online banking to protect themselves against data breaches. For this reason, banks are offering multiple layers of protection in form of heavy encryption of data, the latest virus detection software programs, and the use of firewalls. 
   
   
            
   
   
   
   
   
4. Easier Monitoring & Tracking Of Transactions - Investing in a sound financial management system to track & monitor their business transactions is still a second priority for many small businesses. Here, online banking services allow them to keep all their transactions under one roof. Be it about loan payment under lending services or recovery of loans from customers. Business owners can get their business organized and updated with easy tracking facilities. 
   
   
5. Encourages To Go Green - Online banking is the perfect way to eliminate paper-based processes & transactions. It is an environmentally friendly and more eco-friendly approach towards the environment that enables you to use less paper and go green. These paperless transactions provide clients with access to paperless transfers, e-statement, online customer support, etc. 
       
6. Global Access - Online banking services are accessible all over the world. Whether it is about the issuance of corporate payment cards or any credit or debit cards, all just are a click away. Just approach your bank ID and find customer support. The real-time chat feature allows you to have a direct discussion with the bank's representative and get guidance about your respective requirements. 
   
   
7. Instant Payments - With online banking, you can keep an eye on your recurring bills and ensure instant payments without charging any fee for the delay. It is simple, easy to operate, and a cost-effective option. 
   
   
8. Remote Deposits - If you are maintaining any current account or saving account services, online banking allows you to pay for the products or services immediately from your account to the customer's account. This increases the rate of cash flow in your business. 

These are some of the top benefits of availing online banking services, improving management, security & nature of financial transactions as well as lowering costs and boosting the company’s productivity. 

Why Is The Trade Finance Gap A Great Deal For Exporters?

Finance for international trade has a vital role for exporters all over the world when it comes to completing global foreign trade deals. Due to the associated overseas risks, exporters want to eliminate the payment risk, and thereby demand to be paid upon shipment, while importers are willing to pay only after receiving the ordered goods or services. Here, import/export finance narrows this time gap among parties through various financing options such as Letters of Credit, Bank Guarantee or Documentary Collections, etc. 

A suitable & wide range of access to global financial services provides them with the instant & required short-term working capital to complete the trade-deal-related tasks, that have been stuck due to lack of funds. It makes it one of the most important pillars of international trade & transactions among global traders. 

For many years, different banks & financial institutions have been minimizing the global trade finance gap and covering the risk of non-payment. The estimated risk is 0.2% on average worldwide with a little bit of variation across nations, highlighting international finance as an economic source of funding for SMEs. Currently, various credit & short-term payment guarantees cover around 80% of global trade with over $10 trillion in yearly flows, as shown by the Bank of International Settlements.

Originally Posted: https://www.emeriobanque.com/blogs/why-is-the-trade-finance-gap-a-great-deal-for-exporters

HNB Honoured With ‘Best Retail and SME Bank’ at International Finance Awards

 According to the latest news, Sri Lanka’s most innovative & advanced private sector bank HNB PLC, once again got success in bookmarking its banking excellence at the International Finance Awards 2021, crowned with the Best Retail Bank and Best SME Bank awards in the banking sector. Earlier, Global Finance honored Gulf International Bank with Two Key Awards "Innovators 2021”.

The award function was organized by the renowned International Finance Magazine. It is an international platform for acknowledging and celebrating the world’s best financial institutions. The awards signify the achievement of corporations dominating in advancement, infrastructure development, and customer concentration.

As the sector has developed due to a pile of guidelines, innovation improvements, and market changes, each candidate has been explored by devoted specialists with exceptional thoughts coordinated towards the strength of their requests, execution, and past achievements, the release said. 

Recommended Read: Commercial Bank Is Honoured With 'Best Bank In Qatar 2021' Award By Global Finance

According to HNB Deputy General Manager – Retail and SME Banking, Sanjay Wijemanne, “We are glad to have once again emerged successful as the Best Retail Bank and the Best SME Bank arranged by the renowned International Financial Magazine. This global acknowledgment is a demonstration of our representatives' diligent effort and commitment in the SME and Retail areas, which have developed consistently regardless of the difficulties welcomed by the pandemic, to convey unique products and excellent assistance contributing emphatically towards the development of our customers. Pushing ahead, we promise to keep improving our attention on transformative banking by utilizing the force of innovation to give creative arrangements and cycles for all our customers.”

Recommended Read: Arab Bank Received the Middle East’s Best Trade Finance Provider 2021 Award

Obliging the requirements of over 2.5 million Sri Lankans island-wide, Retail Banking is a leader section for HNB. The Bank has been a pioneer in utilizing digital banking products, services, and channels to give clients advantageous, thorough, and secured options to transact remotely, as per the release.

After the beginning of the pandemic, HNB quickly inserted its full set-up of digital contributions into the contactless delivery mechanism upheld by the state, offered services during the curfew period according to the rules issued by the Central Bank, and worked our devoted Omni Channel engagement Center on a 24*7 basis. 

Recommended Read: African Development Bank Honored With Best Multilateral Financial Institution 2021

Subsequently, the bank stretched out significant relief to customers in Debt Moratoriums and Working Capital advances at concessionary rates. Strikingly, HNB was additionally recently pronounced the Best Retail Bank in Sri Lanka for the eleventh time at the Asian Bankers Awards coordinated by the renowned Asian Banker Magazine. 

With 254 client habitats and over 780 devices across the nation, HNB is one of Sri Lanka's biggest, most technologically creative banks, having success nearby and global acknowledgment for its endeavors to drive forward another worldview in digital banking. HNB has a national rating of AA-(lka) by Fitch Ratings (Lanka) Ltd. The Bank was likewise positioned among the World Top 1,000 Banks list arranged by the esteemed UK-based Banker Magazine for five back-to-back years. HNB was additionally pronounced Best Sub-Custodian Bank in Sri Lanka at the Global Finance Awards 2020.

Trade Finance & Its Advantages

Trade Finance

Trade finance refers to the products & financial instruments that are being used by banks or financial institutions to finance international trade deals. In other words, when an exporter requires an importer to be prepaid for the goods delivered to reduce the risk of payment failure, the importer’s bank provides exporters with a legal payment surety through a range of trade finance instruments. It shows the bank's legal commitment towards exporters regarding an on-time payment upon the presentation of certain documents, such as the Bill of Lading, etc.    

In short, trade finance services including Letter of Credit, Bank Guarantee or Standby LCs etc. make it easier for both the importers & exporters to enter into international trade transactions without associated overseas risks including non-payment & non-performance. Trade finance is a broad term that covers several financial products to provide payment security to the exporters. 

Advantages Of Trade Finance

The main agenda of trade finance is to bring a neutral & legal third party to make transactions safe & secure by taking out the payment & performance risks involved in global trade transactions. 

Trade finance assures exporters that they would be paid on time irrespective of the buyer’s financial capacity while on the other hand, it provides peace of mind to the importers that the exporters will be paid only after the shipment of goods. Here are some of the main advantages of trade finance:

1. Improves Cash Flow & Operational Efficiency - Trade finance helps exporters raise money as working capital to run their business operations until receiving final payment from the importers. Thus, it improves their cash flow and helps with operational efficiency.
   
   
2. Improves Sales & Profits - Since trade finance services provide suppliers with the buyer’s proof of credibility to pay on time while executing any deals, both parties can grow their business without stressing about payment risks.
   
   
3. Less Documentation - Unlike other types of bank loans, the process of obtaining trade finance services is quite easier and requires less documentation. 

Emerio Banque is one of the trusted financial institutions offering a range of trade finance instruments to global traders to secure global trade deals. Contact us now.

Letter of Credit Guide - Features, Importance & When To Use It

Being a global trader, you may have come across the term “Letter of credit” but you wonder what it is, how it works, and why do global traders need it? This Letter of credit guide can help you get your answers.

• What Is A Letter Of Credit?
• What Is The Need For Applying For A Payment Guarantee Letter?
• Features of Letters of Credit
• Importance of Letters of Credit
• Parties Involved In The Issuance of LC
• Types of Letter of credit
• How Does a Letter of Credit Work?
• Documents Required For LC
• Is There Any Difference Between a Loan and a Letter Of Credit?
• What Is The Difference Between A Bank Guarantee And A Letter Of Credit?
• When To Use A Letter Of Credit?
• Advantages of Letter of Credit in Global Trade Deal

Other Advantages of Letter of Credit

1. Letter of credit services allows parties-to-the-contract to trade with unfamiliar overseas parties and establish new trade opportunities.

2. Both importers and exporters can expand their business quickly in new geographical areas.

3. A letter of credit is a safe, customizable, and flexible type of import trade finance.

4. Both the importers and exporters can put their conditions in the LC agreement as per their convenience and requirements.

Trade finance instruments like an LC can significantly help you reduce foreign trade payment risks and allow you to enter into an international trade deal without any threat of payment failure. 

Read more: https://www.emeriobanque.com/blogs/letter-of-credit-guide-features-importance-when-to-use-it

India’s Advanced Step To Secure More International Trade Finance And Why It Is Essential For Exports

This most recent step will help organize the process of securing sufficient working capital to operate smooth trade activities and thereby will mitigate the costs of trade. It will also set out the standards for the proposed ITFS organizations and will generate a more favorable ecosystem for trade finance in the nation.

What is Trade Finance?

Trade finance simply represents a set of several finance instruments & products being provided by the banks & financial institutions to enable companies to execute international trade transactions smoothly & successfully. Any trade deal involves a seller and a buyer of particular goods & services. But when these transactions are made over thousands of miles across the world, it brings associated overseas risks, and trade finance helps in reducing those risks for both the importers & exporters who are completely unfamiliar with one another. Trade finance is an umbrella term that covers many financial products that are being offered by banks & FIs to make trade transactions feasible.

As per the World Trade Organization, some 80-90% of world trade depends on trade finance, including trade credit and insurance or guarantees like Letters of Credit, Bank Guarantee, etc., some of which are short-term.

How Trade Finance Works?

Due to the large financial nature of international trade, exporters demand an advance or upfront payment from the importers for the shipped goods & services so that the exporters can manage the costs of the shipment and other expenses with sufficient working capital funds. However, to reduce the overseas risks, the importer asks the exporters to produce the documents of shipment as evidence of delivery of the goods.

Then, the importer approaches his/her bank to provide a Letter of Credit as a guarantee of on-time payment to the exporter or exporter’s bank upon the presentation of certain documents such as Bills of Lading, etc. The exporter’s bank may provide a loan to the exporter based on the export contract.

The type of the trade finance instrument being issued by a bank depends on the nature of the transaction and how evidence of performance can be witnessed ie. Bill of Lading to show successful shipment of goods. It is essential to keep in mind that banks are only responsible to deal with the documents, not the actual delivery of goods, services, or performance to which the documents are related.

What Are The Circumstances In India?

Importers and exporters are struggling in gaining sufficient finance, especially in the terms of their capability to convert trade receivables into liquid funds or to achieve short-term funding for their payment for import of the goods and services.

In this process, SMEs i.e. small & medium-sized enterprises are adversely affected as they often have to face hurdles to get enough funding for their working capital requirements, even after finding an international buyer who is willing to send over prepayment. Read more: https://www.prfree.org/@emeriobanque/india-s-advanced-step-to-secure-more-international-trade-finance-and-why-it-is-essential-for-exports-6rmy4br8rkb4

Carlyle’s Fund Infusion Encourages PNB Housing Share’s Growth

 As per the latest reports, PNB (Punjab National Bank) witnessed a surge of 20% in its shares on 31st May 2021 after its board received capital funding worth  ₹4,000 crores from the Carlyle Group along with a handful of other modest investors through a preferential share issue. The aforesaid fundraising by marquee investors proved a significant contribution for the shares of PNB Housing Finance Ltd than an uncontrolled assembly in equity markets. 

This fund infusion will help Carlyle to raise its stake in the organization to 30% from the current 26%. Walking about other investors signifies the name of Aditya Puri, former chief executive of HDFC Bank Ltd.

Puri is probably going to be assigned to the board, PNB Housing Finance said in a release. PNB will stay the advertiser, yet with a decreased shareholding. 

Due to a disrupted real estate sector, the balance sheet of the PNB Housing Finance has been under tremendous pressure. The uneven exposure to underlined developers had a bad influence over its valuations and its balance sheet stability in the last few years, following the global pandemic. According to the adjoining report, the lenders have also witnessed a shrink in assets under management (AUM) and a boost in bad loans. Read more: https://tostories.com/carlyles-fund-infusion-encourages-pnb-housing-shares-growth/

Apply For Letter Of Credit Services With Emerio Banque

Using a letter of credit, also known as document credit or payment guarantee letter, is one of the best ways to secure payments & reduce associated overseas risks in international trade transactions. If you are a global trader dealing in import/export transactions and thinking of availing a letter of credit service, Emerio Banque is a one-stop platform. A leading & popular financial institution, Emerio Banque is a group of highly qualified, experienced, and expert financial advisors who are dedicated to understanding your requirements and suggest you with the most appropriate & suitable letter of credit services depending on business size, nature & goals.

A letter of credit is one of the most used trade finance instruments issued by a bank or an FI on the behalf of the importers to mitigate the risks of non-payment & non-performance in overseas trade transactions. Emerio Banque not only helps its clients assure their overseas suppliers by providing them with instant access to funds to back their imports.

With market knowledge & earned experience, our financial advisors evaluate your risks and provide you with a variety of letter of credit services you can choose from and execute transactions smoothly. So stop wasting your time and contact Emerio Banque now.