adv-06
adv-06

Modifi transforming trade finance roadblocks in Bangladesh

adv-07
nelson

Nelson Holzner is the CEO and Co-Founder of MODIFI

Nelson Holzner is the CEO and Co-Founder of MODIFI, a global fintech company that helps SMEs finance and manage their international trades. He is a serial entrepreneur with over 20 years of professional experience in top international firms, startups, and high-growth companies. As a founder and former CEO of BillPay, Nelson guided the company to over €3bn in factoring payments, which he later sold to Klarna, one of the most valuable fintech companies in the world.

Q1. Could you please share the journey of Modifi’s and its current business status globally? 

  • MODIFI is a global FinTech company which was founded 2018 in Berlin, Germany
  • With MODIFI, exporters can grant their Buyers up to 150 days payment terms while still getting paid upfront by MODIFI. 
  • MODIFI is backed by Maersk, the leading container shipping company, Italy’s largest bank IntesaSanPaolo and venture capital investors like Rocket Internet.
  • Founders built previously a payment company in e-commerce for consumers which allows consumers to buy goods now and pay for them later
  • MODIFI brings this buy now pay later model to global Business Payments: Exporters get paid instantly while Buyers have the option to pay later. 
  • We serve more than 1,200 Buyers and Sellers across more than 40 countries
  • We are processing trade in various industries but have a strong business in consumer goods, especially in garments and apparel

Q2. How is Modifi transforming trade finance roadblocks in Bangladesh? How to access the Modifi’s finance and how the buyers & suppliers can be benefited through this initiative?  

  • MODIFI gives small and mid-sized exporters access to fast cash and protection against insolvency of their Buyers abroad
  • This allows exporters to grow and win more business from bigger Buyers requesting payment terms. So we create a win-win-situation for both exporters and buyers.
  • The service is delivered 100% digitally on our global platform – no physical papers need to be sent or collected. Everything from becoming a MODIFI customer to uploading invoices and other documents to approvals and payouts happens digitally. 
  • Technology allows us to be much faster than banks or other financiers: Customers can receive money in the bank within 5 days from first contact.

Q3. What are the current challenges from a region perspective – how is Modifi a differentiator in that aspect?

  • With the current macroeconomic environment of inflation, supply-chain disruptions, COVID-19 and the war in Europe, exporters should protect themselves against the risk that their Buyers will not pay their invoices. MODIFI takes over the loss risk and allows exporters to trade with confidence. So unlike traditional financing, MODIFI’s financing is non-recourse, so the exporter does not have to pay back the financed amount when their buyers cannot pay.
  • Exports are to a large extent still quite paper-based and slow. As a digital platform we help to streamline these processes and get cash faster to the exporters. 

Q4. What are the opportunities and challenges ahead for Modifi in Bangladesh?

  • Bangladesh is a fantastic opportunity for MODIFI because we can help many small and mid-sized exporters to trade with big buyers who demand payment terms.
  • There is a huge demand for cash / liquidity from Bangladeshi exporters who are the backbone of the local economy. In addition to liquidity, these businesses need confidence that the goods shipped will be paid.
  • We have been in Bangladesh for almost one year and we are just getting started.
  • Challenging are certain local regulatory rules, e.g. high advance rates. These rules are designed to ensure that Bangladeshi exporters are getting paid properly. But sometimes they limit our ability to serve certain exporters and buyers as the risk profile cannot be properly priced.  

Q5. What are your future plans in terms of product, funding, and global expansion?

  • We are building out our business in Bangladesh and will leverage our global presence even more.
  • With our presence in Europe, Asia and North America, MODIFI is already covering 80% of global trade volume. We focus on our existing markets now and will expand geographically only opportunistically.
  • MODIFI will also add more trade services on its platform to help small and mid-sized businesses to trade even better. For example, we provide a free shipment tracker on our platform where everyone can see where their shipments are. All you need is sign up on our platform and enter your container number. And there are a number of additional services which we will bring to the export community soon.
failed