JPMorgan Chase & Co JPM.N has partnered with fintech OmniLatam to extend credit lines to mid-sized and small suppliers of big corporations in Latin America.
OmniLatam, which operates in Colombia and Chile and recently opened an office in Brazil, will provide receivable-backed credit and working capital lines to suppliers of JPMorgan’s clients in the region, which are large local corporations or multinationals’ subsidiaries.
“Suppliers will have access to lower-cost to discount their receivables at a time of rising interest rates”, said Ignacio Munoz De Cote, Head of Latin America Payments at JPMorgan. Corporations can ensure that their suppliers are financially sound and reduce the pressure to raise prices, according to him.
According to Filipe Oliveira, JPMorgan’s Latam Trade and Working Capital executive, the bank aims to keep 100% of the credit issued under the agreement on its balance sheet. With the agreement, the bank expects its present supply chain finance assets to increase in three years.
According to Diego Caicedo, CEO and co-founder of OmniLatam, the company expects to offer additional working capital products relating to accounts receivable and payable, as well as possibly develop new products as a result of the agreement.
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