In the era of supply chain finance 4.0, what is the value of data elements?

Text/Yang Yunfei

In the era of supply chain finance 4.0, the value of data elements is not only to provide information and support decision-making, but also to promote the innovation and development of supply chain finance.

In recent years, the state has successively issued a series of major policies on big data and data elements, especially the 2022 "Opinions on Building a Data Basic System to Better Play the Role of Data Elements" (hereinafter referred to as the "Data 20"), which has promoted the data elements to enter the fast lane of value circulation exploration. At the beginning of this year, 17 departments, including the National Data Bureau, the People's Bank of China and the State Administration of Financial Regulation, jointly issued the "Data Element ×" Three-Year Action Plan (2024-2026), showing the value and importance of data in the modern economy.

Recently, at the 2024 Industrial Digital Finance and Data Assets Summit Forum (hereinafter referred to as the "Forum") jointly sponsored by the Blockchain Branch of the China Federation of Logistics and Purchasing (hereinafter referred to as the "China Federation of Things"), EFEC Industry Chain Network and other units, participating enterprises and industry experts conducted in-depth discussions on key industry topics such as the value path of data elements and data assets, and supply chain financial risk control.

It has become the core driving force for the development of supply chain finance

"As a new factor of production, data is the key force for the development of new quality productivity, and the combination of data, technology and finance can play a multiplier role in the process of improving the competitiveness and resilience of the industrial chain, the most anticipated of which is the digital supply chain finance business." Liu Yang, deputy secretary-general of the China Federation of Things Blockchain Branch (digital economy) and head of industrial finance, emphasized at the forum.

"Compared with traditional finance, the digital empowerment of industrial finance should focus on how to build a new model of digital and real integration, as well as realize the transformation of credit service concepts and service means." Zhang Jian, deputy general manager of Shanghai Data Exchange, said at the forum that the release of the value of data elements provides a good technical means for financial support for industrial upgrading in the high-quality development stage, and improves the availability of services.

In short, with the advancement of technology and digital transformation, data has become the core driving force for the development of supply chain finance, which in turn has pushed the supply chain finance industry into a new stage. "The comprehensive application of technologies such as big data, artificial intelligence, 5G, cloud computing and blockchain is driving the development of the mainland supply chain finance industry in the direction of intelligence, digitalization and efficiency. The development of these technologies not only improves the service quality and efficiency of supply chain finance, but also provides strong technical support for the long-term sustainable development of the industry. Liu Dacheng, executive vice president of China Industrial Development Research Institute and doctoral supervisor of Tsinghua University, said at the forum that at this stage, blockchain technology is widely used in the field of supply chain finance, which not only improves the efficiency and security of financial services, but also promotes the digital transformation of supply chain finance.

Assist in the transformation of supply chain finance from chain to network

According to the data, the digital penetration rate of supply chain finance in China has increased from 5% in 2018 to 30% in 2022 and is expected to reach 50% by 2027. This is mainly due to the innovation of digital financing models of supply chain finance, such as the digital transformation of the traditional supply chain finance model relying on core enterprises and the new digital supply chain finance model relying on B2B e-commerce platforms.

However, it is worth noting that in the context of digitalization, supply chain finance is still facing new development opportunities and challenges. For example, many industries in the manufacturing industry have the characteristics of long industrial chain supply chains, low industry concentration, and many participating enterprises. These characteristics make the demand for supply chain financial services strong, but the complex organizational form and factor association also lead to the extremely complex situation of supply chain logistics, capital flow and information flow, which brings great obstacles to the development of supply chain finance business.

Relevant data show that up to now, the digital penetration rate of domestic accounts receivable financing models has reached 45%, while the digital penetration rate of other models is less than 10%. It can be said that supply chain finance is in the early stage of the intelligent platform model, and the scale of digital business of inventory financing and advance payment financing will become the next development direction of the industry.

"Based on the warehousing and logistics ground network and the information sky network, and relying on the deep commodity trading capabilities, Zheshang Zhongtuo builds a digital ecosystem for bulk commodities, manages supply chain risks for financial institutions, and strengthens supply chain services for manufacturing enterprises." At the forum, Wu Qiao, general manager of the logistics and finance division of Zheshang Zhongtuo Group, said that the development of supply chain finance should move towards industrialization and digitalization, and the industrial Internet platform links industrial development and financial system and industry-related ecosystems, builds a digital risk system, efficient operation system, reduces the operating costs and financing costs of small and medium-sized enterprises, and enhances the competitiveness of enterprises.

Supply chain finance 4.0 is characterized by demand-led transformation from chain to network. This means that supply chain finance is not just based on a single supply chain, but a network that spans multiple supply chains. At this stage, supply chain finance will have more obvious cross-regional, cross-departmental, and cross-chain ecological characteristics.

The two major elements of finance and technology are intertwined and mutually reinforcing, further leading the development of supply chain finance. From the perspective of the financial side, financial institutions will focus on the enterprise supply chain ecology, fully integrate financial and non-financial resources, and expand channels, customers and service capabilities. From the perspective of science and technology, digital technology companies will give more prominence to standardization, componentization and tooling in the product design of supply chain financial technology, so as to quickly adapt to the needs of different industries and different customers.

In this regard, Pu Zhijiang, Secretary of the Party Committee and Chairman of Zhejiang ITG Yunshang Holdings Co., Ltd., believes from a comprehensive analysis of supply chain finance related parties: from the perspective of the chain owner, it is necessary to integrate resources, control risks and ensure the authenticity and smooth operation of the supply chain business based on the business model, service platform, operating system and industry standards; From the perspective of the industrial chain, financial service providers provide various financial services for the supply chain, such as financing, insurance and wealth management, etc., and banks have launched differentiated financial service products, providing mortgage financing of goods rights, accounts receivable pledge financing, prepaid accounts financing, etc., continuously innovating supply chain financial services and building a cross-border integrated digital ecosystem. From the perspective of risk control, it is necessary to ensure that "paper risk control research and judgment are in place, and practical risk control and control are in place" to ensure that business risks are "preventable, controllable, and bearable"; From the perspective of business access, in-depth analysis and judgment of 4W3H were conducted.

"In view of the various trusted collaboration problems faced by all participants in the industry in the process of industrial collaboration, we reduce the cost of trust for all parties through the trusted on-chain solution of "blockchain + IOT". Dang Yan, head of Ant Group-Ant Digital's new shared trusted assets, said in her speech that based on blockchain technology, Ant Digital has built a supply chain finance platform for core enterprises, linking financial products of financial institutions through the platform and transaction data, meeting its ecological upstream and downstream partners to obtain financing products with convenient operation and preferential interest rates, and at the same time providing core enterprises with intelligent platform management means and operation service tools to ensure the large-scale, healthy and benign continuous operation and transformation of the platform.

Undoubtedly, data elements play an important role in the transformation of supply chain finance from chain to network. Through the use of big data, cloud computing and other technologies, financial institutions can improve risk identification and control capabilities, optimize financing services, improve the efficiency of financial services, expand the field of financial services, and promote the coordinated development of the industrial chain.

The inclusion of data assets in the table has become an important trend in supply chain finance

In the era of big data, the growth of data volume is undoubtedly significant. However, in order to truly tap the value of data, we must not only pay attention to the "quantity" of data, but also pursue "thick" data. The so-called "thick" data emphasizes the quality and depth of the data, not just the quantity.

The data shows that with the rapid development of computing power and general artificial intelligence technology, the amount of domestic data is growing at a rate of more than 20% per year, and the proportion of unstructured data is also increasing. In August last year, the Ministry of Finance issued a notice on the Interim Provisions on the Accounting Treatment of Enterprise Data Resources (hereinafter referred to as the "Provisions"), which further clarified the requirements for the listing and disclosure of data resources, and from January 1, 2024, enterprises need to confirm, measure and report on transactions and matters related to data resources according to the purpose of holding data resources, the way they are formed, and the business model, and voluntarily disclose data resource information.

It can be said that the introduction of the relevant policies of "20 data items" and "data asset entry into the table" has pointed out the implementation path for the market-oriented allocation of data elements. "In the process of realizing the value of data elements, we can take 'new mechanisms, new subjects, and new facilities' as the starting point to explore new mechanism models, position new participation roles, and build new infrastructure." Han Peng, senior architect of Tencent Cloud, said at the forum that for enterprises, on the one hand, it is expected to bring substantial asset appreciation to the enterprise itself, and the corresponding PB (price-to-book ratio) will decrease year-on-year, and the valuation is expected to be revalued, so as to provide a foundation for its financing development. On the other hand, all business entities may share this "cake", which is of an "inclusive" nature. Leading companies play a leading role while promoting collaboration among large and medium-sized enterprises.

"Data asset entry is a key link in the value transformation of data assets, the starting point of data asset financial innovation, and an indispensable step in the complete cycle mechanism of the data value chain." Liu Dacheng emphasized that in the entry of data assets into the table and on-site and over-the-counter transactions, enterprises have problems such as insufficient internal drive for data asset management, disconnection from business management, low data quality, difficulty in sustainable operation of assets, and aggravated security risks. The goal of delivering and increasing the value of your data assets.

In short, in the era of supply chain finance 4.0, the value of data elements is not only to provide information and support decision-making, but also to promote the innovation and development of supply chain finance.

The entry of data assets into the table will become an important trend in the era of supply chain finance 4.0, which is of great significance for improving the transparency, efficiency, risk management capabilities, innovation capabilities and improvement of the regulatory system of supply chain finance. Enterprises should fully recognize the value of data assets and increase investment and management of data assets to adapt to the challenges and opportunities of the supply chain finance 4.0 era. (This article was published in the 13th issue of China Logistics & Purchasing magazine in 2024)