We are sure you heard about GIFT City (Gujarat International Finance Tech City) near Ahmedabad in India. India’s one and only International Financial Service Centre (IFSC) is located in the GIFT City. IFSC is an independent jurisdiction under the Constitution of India established in December 2019 under the Special Economic Zones Act 2005. The principal governing body is the International Financial Services Centre Authority (IFSCA). 

IFSCA is the financial services regulator which regulates the conduct of financial services / institutions operating in the International Financial Service Centre. The main objective of IFSCA is to develop a strong global connect and focus on the needs of Indian Economy as well as to serve as an International Financial Platform for the global economy.

To achieve its objectives IFSCA is in the process of implementing various initiatives related to a breadth of financial services. One such important initiatives of IFSCA is to build and operate an electronic platform to facilitate financing of international trade flows through an institutional mechanism on a dedicated electronic platform which is able to meet the trade finance requirement of Exporters (Sellers) and Importers (Buyers) through multiple financiers.

ITFS – International Trade Financial Services is the electronic platform which will provide Tarde Finance Services at the International Financial Services Centre. It is the electronic platform referred above which will facilitate financing Cross Border Trade through a transparent bidding mechanism to Buyers and Sellers across the globe with participation from Financial Institutions located in India or abroad.

The ITFS platform operator shall not assume any credit risk on the transactions carried out on its platform or provide any guarantee for the same to any of its participants.

Vayana TradeXchange is the brand name under which Vayana (IFSC) Pvt Ltd, (which is a wholly owned subsidiary of Vay Network Services Pvt Ltd) offers all its products and services. VTX has obtained the necessary approval from IFSCA to build and operate its ITFS platform – Vayana TradeXchange (VTX).

Vayana Network (Brand name of Vay Network Services Pvt Ltd.) has been operating in the Supply Chain Finance (SCF) space, both domestic and cross border, for almost a decade. We are a B2B service provider in the area of trade finance and GST Compliance. Vayana Network is the largest SCF platform in India and is expected to cross USD 8 billion in disbursements for the FY 2021-22. The company operates a digital platform connecting Financial Institutions (Banks and NBFCs) to Corporates and their Supply Chains enabling FIs to provide short term trade finance to MSMEs on the Network. Vayana Network’s main line of business is to provide platforms / systems / IT Solutions / processes to Banks / Large Corporates and their Suppliers and Dealers and facilitate end to end digitised supply chain financing solution. The Company is also a leading GSTN authorized GSP (GST Suvidha Provider) and a key player in the GSP and eWay Bill Compliance. space, handling over 20 Mn API Calls every month.

A large number of Corporates, Institutions as well as SMEs have chosen Vayana GSP to meet their compliance needs. The Company offers end-to-end business-data-to-GST preparation service through its SahiGST platform for Indian constituents.

VTX is a Trade Finance digital exchange with Buyers , Sellers and Financiers as its participants. The objective of the platform is to provide seamless processes to the Buyers and Sellers in meeting their financial requirement and augmenting their working capital cash flows. VTX supports the Financiers in increasing their book and taking exposures on the Buyers and Sellers registered with VTX.

Vayana TradeXchange provides the participants a transparent auction-based mechanism in which multiple Financiers bid for financing a Trade Receivable or a Trade Payable through Factoring or Reverse Factoring.

VTX also ensures detailed due diligence on each participant through strict KYC / AML / CFT checks along with fraud management, data confidentiality and transaction security.

All Buyers, Sellers , Financiers and Insurance/ Credit Guarantee Institutions and other eligible entities as stated below can get registered with VTX. The participants, their promoter/s or promoter groups should be domiciled and regulated or registered in jurisdictions not identified in the public statement of Financial Action Task Force as “ High Risk Jurisdiction” subject to a “Call for Action” or from any jurisdiction/ country specified by the Govt of India by an order or by way of agreement or treaty with other sovereign government.

Any Buyer, Seller or Financier as stated above can register themselves on VTX completely digitally. You can visit our website at www.vayanatradexchange.com and click on the guest user icon. Select your entity type Buyer/ Seller or Financier along with other mandatory credentials and submit. You will be receiving a mail from VTX along with your user ID and Password. With this you can log into the VTX ITFS application and fill up the detailed Application Form for registering your entity on VTX.

As per the current IFSCA guidelines all entities to be registered or on boarded on the VTX will have to be KYC/ AML / CFT compliant and subject to proper due diligence. Basic documents related to KYC like address proof and identity proof must be provided for verification and will be kept on record by VTX. VTX will also ask for details of Ultimate Business Ownership from each entity. Other documents will depend on the type of the entity like Company, partnership or proprietorship etc and the country from which the entity operates. 

VTX Application Form is intuitive and will provide a list of documents to be submitted depending for the entity type. Entities desirous of registering themselves with VTX have to execute a one time Master Agreement, the format of which will be available along with the Application Form. To execute the Master Agreement the entity needs to designate one or more authorised signatories, and a valid authorisation letter, such authorisation letter must be submitted to VTX in original. Other details are explained in detail in the login section of the application which can be accessed after one successfully registers oneself as a “guest user”.

In case the entity is having the 20 digit LEI Code Number (Legal Entity Identifier Code) or CKYC Registration No. the same must be shared with VTX. The Indian entities desirous of registering themselves on VTX must also submit a declaration/ undertaking that they are in compliance with the applicable provisions of The FEMA and / or the relevant DGTF requirements in respect of transactions
undertaken on the VTX.

The products on the VTX platform will be Financing of Accounts Receivable and also Accounts Payable by Factoring or Reverse Factoring on either a with recourse or without recourse basis. There will be financing products for all Buyers and Sellers on the
VTX platform.

For detailed demo of the products, you are requested to get in touch with us at the below-mentioned addresses:

Unit Nos. 104 & 105, First Floor, Inspire BKC, G Block, BKC Main Road, Bandra Kurla Complex, Bandra (East), Mumbai – 400 051

Send email to sales@vayanatradexchange.com

For Info: www.vayanatradexchange.com

VTX will be charging a onetime setup fee to all participants at the time of registration.

Sellers / Buyers and Financiers also need to pay the following transaction fee :

• Seller or Buyer pays interest against the funding to the Financier
• Seller / Buyer and Financier pays transaction fee to VTX.
  
  

Transaction fee be paid to VTX will be a flat fee on the gross value of invoice uploaded by the Seller/ Buyer for financing.

The setup fee and transaction fee will be decided at the time of execution of Master Agreement between the entity and VTX.

It may be noted that an entity before going live on VTX needs to execute the Master Agreement and pay the setup fee.

The documents to be uploaded on the platform by the Buyer/ Seller are listed below: 

• Invoice (mandatory and must contain the six digit HS Code – Harmonized Systems Code)
• Bill of Lading / Airway Bill / Charterparty Bill of Lading / etc (mandatory)
• Packing list
• Insurance
• Certificate of Origin
• Inspection Certificate
  
  

Or any other document/s required by the Buyer/ Seller Or as required under specific products called for by VTX.

A Trade Finance Unit – TFU will represent the gross invoice value and a confirmed obligation of the Buyer. TFU will be created on VTX once the Seller uploads the Invoice data on the platform along with all mandatory documents supporting it. The TFU will carry the following details – details of Seller and Buyer, issue date, due date, tenor in number of days (due date – issue date), balance tenor (due date – current date), total amount due (gross value of Invoice), unique identification number as generated by ITFS, account details of Seller / Buyer (for reference of Financier) and description of Goods. TFU will also have other information/ data as deemed necessary by VTX which will be communicated at the time of Registration.  

A Reverse Trade Finance Unit – RTFU will represent the gross invoice value and a confirmed obligation of the Buyer. RTFU will be created on VTX once the Buyer uploads the Invoice data on the platform along with all mandatory documents supporting it. The RTFU will carry the following details – details of Seller and Buyer, issue date, due date, tenor in number of days (due date – issue date), balance tenor (due date – current date), total amount due (gross value of Invoice), unique identification number as generated by ITFS,
account details of Seller / Buyer (for reference of Financier) and description of Goods. RTFU will also have other information/ data as deemed necessary by VTX which will be communicated at the time of Registration.  

To start with VTX will facilitate transactions (Factoring and Reverse Factoring) in US Dollars, Great Britain Pound Sterling and Euro only. In future it is anticipated that other currencies will be added depending on the demand from various trade corridors.  

Once the TFU/ RTFU is created on VTX by the Seller/ Buyer it will appear on the auction platform of VTX for bidding by the Financiers registered with VTX. The bids are the coupon rates being quoted by the Financiers considering various factors as per their internal risk assessment process.

The bidding window will remain open for the Financiers for 72 hours from the time the TFU/RTFU is activated on the auction platform by VTX for updating their bids or putting in new bids. The bidding window will close as soon as the TFU/RTFU gets accepted by the Seller or 72 hours is over from the time the TFU/RTFU is activated on the auction platform by VTX which ever is earlier.

In case no bid is received from the Financiers or it is not accepted by the seller within 72 hours from the time the TFU/RTFU is activated on the auction platform by VTX, the TFU/RTFU expires with an attribute – “expired unfinanced”. The TFU/ RTFU with an attribute “expired unfinanced” can again be uploaded on VTX by the Seller / Buyer for bidding.

For TFUs/ RTFUs where the bidding process is closed successfully, the “Seller’s Bank” will receive the money within T+2 days. Here “Seller’s Bank” will include its Correspondent Bank also and credit to the Seller Bank’s Nostro Account maintained with its Correspondent Bank will be construed as credit to the Seller.  

VTX Settlement will have two legs –

1. Disbursement by the Financier to the Seller on acceptance of the bid by the Seller/ Buyer
2. Repayment by the Buyer to the Financier

 
All settlements will follow the existing payment mechanism for cross-border trade through the Seller’s / Buyer’s Bank by authenticated SWIFT messages and will be outside the VTX platform. 

VTX however will have a monitoring mechanism in place to confirm receipt of disbursement proceeds by the seller and repayments by the buyers.  

Minimum Value of Finance – USD 10000 / GBP 7500 / EUR 8000*

Maximum Value of Finance – Any amount*

*Financing will be restricted to 80% of gross invoice value subject to the above minimum value. 

VTX will remain open for bidding from 7 am (IST) to 11 pm (IST) from Monday to Friday every week. VTX will be closed for operations on Saturday and Sunday of every week and on all Bank Holidays as applicable in the State of Gujarat, India.