Business model transformation made easier by innovative digital banking
2015 marks the inception of Internet+ in China where internet-enabled entrepreneurship started to boom. That was when www.echemi.com was launched. Now in 2020, this online platform has grown to become the No.1 foreign trade platform for fine chemicals where less-known materials such as propylene glycol and caustic soda flakes are sold to more than 110 counties and territories to be made into soaps, detergents, and skincare and cosmetic products. Today, as a one-stop cross-border platform for B2B trading of fine chemicals, Echemi can provide a broad range of original services anytime and anywhere, including cargo hosting, sales channel matchmaking, trade agency services, supply chain services, and express customs clearance and tax rebates. Each year, the company receives an average of 2,700 to 3,000 orders from overseas customers, making it a powerhouse in the industry and a perfect success story of internet-enabled entrepreneurship.
When Echemi was founded, David Zhang, the company’s Chairman and CEO, would never expect such fast growth. Unlike traditional chemical trade, the burgeoning online platform has brought forth a large number of all-weather and high-frequency transactions to be settled. Moreover, its fast-growing overseas business has also seen increasing transactions conducted in foreign currencies and associated FX risks. Faced with these fundamental challenges, the company came to HSBC for a solution.
HSBC’s response is its full suite of digital banking offerings built on HSBCnet, the Bank’s digital banking platform. Featuring a streamlined process, the platform is capable of processing online payments in batches and thus can fast-track settlement of huge amounts of cross-border payments with significantly increased efficiency and reduced errors. It also offers real-time tracking of payments and trade transactions. In terms of FX services, HSBCnet enables real-time preview of FX quote for each payment, thereby empowering clients with significantly enhanced control over FX rates during settlement. Meanwhile it also allows query for spot and forward FX rates and online booking of rate in order to meet more sophisticated FX needs of corporate clients.