Sri Lanka’s Hirdaramani, Bangladesh apparel firms on HSBC Serai tech platform
ECONOMYNEXT – Sri Lanka’s Hirdaramani group and several Bangladesh apparel firms are among early adopters of a supply chain matching service for small- and medium-sized companies by HSBC tech start-up Serai.
Vivek Ramachandran, chief executive of Hong Kong-based Serai, said the service went live in October and is being piloted globally with one target sector being garments manufacturers.
“Sri Lanka’s garments sector is incredibly advanced and is making genuine use of technology,” he told a forum where HSBC introduced the new service by Serai, which takes its name from ‘CaravanSerai’, as ancient stopping places of travelling merchants were known.
“CaravanSerai was a meeting place to international trade,” Ramachandran said. “We are trying to build the digital equivalent of that trade.”
Among businesses already on Serai are Hirdaramani, three firms from Bangladesh and three from Hong Kong, including Esquel which has a factory in Sri Lanka.
Ramachandran said HSBC, a bank founded to finance international trade, believes the pain points of trade are not limited to financing but go wider like finding new counterparts, as it takes companies months to build credibility.
“We think technology should do it a lot quicker.”
Through Serai, HSBC is trying to change the business-to-business relationships in the clothing and garment sector, he said.
Transparency was important in the trade as new buyers care who makes their clothes.
Ramachandran said Serai is not offering banking services and is not regulated like a bank
Serai’s service is expected to make use of HSBC’s trade banking client network globally.
According to HSBC, Serai is starting to digitally connect buyers and sellers in the clothing and garments industry, helping firms build supply networks they know and trust.
It has a moneylender license in Hong Kong with the rules for money lenders to issue loans being looser than that for banks which since the 2008 global financial crisis find it expensive to lend to small businesses.
(COLOMBO, 19 November 2019)