Abstract

The objective of this paper is to analyze the problems of information asymmetry, mode lag, and high operational risk between banks and enterprises in the practice of supply chain finance business. In this paper, first, the concept and function of supply chain finance were elaborated, and the theoretical basis of supply chain financial risk control was studied. The implement of principal agent, information asymmetry theory, and self-compensated trade finance theory on realizing the risk avoidance in the actual development process was analyzed. Then, the business processes of the three basic financing models of supply chain finance and the shortcomings in the operation of each model were proposed. On this basis, risk sources and influencing factors of supply chain finance were analyzed, and operational risks were emphasized. Finally, a new financing mode of inventory pledge was designed based on the special function of Internet of Things (IoT) technology and the business process of inventory financing mode. The results showed that there was a big gap in the value of risk loss caused by various types of loss events in the operation risk of supply chain finance inventory pledge financing mode; among them, the biggest losses were from external fraud. By comparing the expected loss (ES) value of inventory pledge financing mode based on the IoT with the operation risk of traditional mode, it could be found that the supply chain finance mode based on the IoT technology effectively reduced the operation risk. Therefore, the system designed in this paper has certain reference and practical significance for financial risk management.

Highlights

  • By means of Internet + and electronic information technology, supply chain finance has formed a sound solution to the financing difficulties of Small and medium enterprise (SEMs)

  • OPERATIONAL RISK ANALYSIS OF INVENTORY PLEDGE FINANCING MODE BASED ON Internet of Things (IoT) The supply chain finance business carried out by banks no longer independently evaluated the financial status of financing SEMs, but focused on the real trade background of the supply chain, emphasized the trade self-compensation of credit and repayment, and conducted closed management of funds

  • The inventory pledge financing mode designed based on IoT reduced the credit risk and market risk of the loan business between banks and financing SEMs, and reduced the operational risk

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Summary

Introduction

By means of Internet + and electronic information technology, supply chain finance has formed a sound solution to the financing difficulties of Small and medium enterprise (SEMs). The compound growth rate of the supply chain financial market in the five years will remain at about 15%, and the market share will further reach about 15 trillion by 2020 [1]. In the mode of warehouse receipt pledge financing, because the transaction information between banks is. Relatively confidential, the information of pledge business is only shared to a limited extent, which leaves room for financiers to operate. How to make full use of supply chain finance to develop banking business and solve the financing problems of SEMs, at the same time, how to optimize and improve its mode so as to achieve effective risk management has become a problem to be studied

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