China State Construction Engineering Corporation (CSCEC) has signed a supply chain finance (SCF) agreement with UAE-based National Bank of Abu Dhabi (NBAD) to help enable Chinese corporate to offer better payment terms to suppliers as well as enhance its cash flow management.

After executing a similar solution with a major airline, NBAD earlier this year became the first bank in the UAE to provide an SCF platform based in the region, which means that it can be customised for the commercial conditions in the Middle East, said the Abu Dhabi bank in a statement.

While SCF is well-established globally the solution is still nascent in the Middle East and North Africa (Mena) region. SCF solutions create a win-win situation for the company and their suppliers.

Under this, suppliers - mostly SMEs (small and medium enterprises) - receive payments faster and directly from the bank. Corporates on the other hand benefit consequently from a healthier supplier community, thereby securing their own supply chain, said the statement.

The new agreement with CSCEC, a global engineering company with extensive Middle East operations, has brought NBAD’s trade finance offering to the next level by attracting global brands, it added.

Vineet Varma, the managing director and head of GTB, said: "NBAD is very proud of this solution, which emphasises our commitment to provide the best in class trade finance solutions. SCF is a sophisticated value-added product and our bank is on the forefront of innovation in the region."

"Our product suite , provides international and regional clients with the extensive support from a bank that has both local experience and the required depth of business in the region," stated Varma.

Vivek Vohra, the managing director and global head of traders, (Retailers and diversified sector) said: "NBAD is delighted to serve the need of CSCEC via supply chain finance, as this will further strengthen the relationship between this company and our bank."

Li Ye, the chief finance officer of CSCEC, said signing up to an SCF solution was a logical step for the company in the direction of enhancing the quality of its relationship with suppliers.

"This provides additional liquidity to our suppliers and enhances their ability to work with us in a timely fashion. Since the program is fully automated, this creates operations efficiencies. Working with NBAD as a partner helps us leverage their extensive resources in UAE & the region," he added.-TradeArabia News Service