Envysion Wealth Management has launched a Supply Chain Enabler Fund (SCEF) under its variable capital company (VCC) - Envysion Global Investments VCC to provide a variety of investment strategies for its high-net-worth (HNW) clients.
One of the fastest-growing investment themes this year is environmental, social and corporate governance investing, which is also an area of focus for Envysion. Riding on this investment theme, the firm rolled out the SCEF to provide liquidity to small and medium-sized enterprises (SMEs) during this challenging time, with the objective of making investments into or acquire receivables of SMEs associated with supply chain functions, services or logistics.
For the SCEF, Envysion will focus specifically on the receivables from government-linked companies and fundamentally strong corporates. This trade financing model will allow SMEs to get access to liquidity earlier based on the invoices that they are owed by their customers, providing an improvement to their cashflow as financial institutions worldwide scale back on invoice financing.
Despite investing to acquire receivables, which are considered a reliable and low-risk asset class, the availability and supply has not been sufficient to meet demand. Access to finance remains disproportionately skewed in favour of large firms. While SMEs account for 37% of trade finance demand, the rejection rate from banks of SME proposals is 45% higher relative to mid-sized and larger firms (39%) and multinational corporations (17%).