The cutting edge of working capital finance

Working capital finance needs to grow more agile. And with other processes in trade benefiting from the blockchain, enterprise resourcing planning (ERP) integration, and artificial intelligence (AI) automation, why should working capital be left in the cold?

In trying to understand where the boundaries of working capital finance is drawn and pushed, Doga Usanmaz, Reporter at Trade Finance Global (TFG), heard from three J.P. Morgan Payments senior leaders: Natasha Condon, Global Head of Trade Sales, Heather Crowley, Managing Director, Global Head of Trade and Working Capital Product, and Laura Galvin, Global Head of Export and Agency Finance.

Doga Usanmaz (DU): As we define the ‘cutting edge of working capital finance’ today, what practices are slowly becoming outdated?

Natasha Condon (NC): Friction! Friction is becoming outdated. Supplier onboarding needs to be effortless, ERP integration needs to be light and low-touch, and inventory needs to change ownership with no physical disruption to a highly refined logistics chain. 

In practice, this means the ‘traditional’ solutions need to evolve. Clients still have the same goals of risk mitigation, liquidity, working capital, and negotiating leverage with suppliers and customers; but now they expect solutions to provide all those benefits while being easy to implement, attractive to their commercial counterparties, and flexible to adjust quickly if their supply chains need to move. 

Take standard receivables financing that requires a clunky approval process via a credit insurer every time a new customer comes on board. That feels very old-fashioned in 2026 when global geopolitics can move a supply chain overnight. Agility is the order of the day. 

Heather Crowley (HC): Geopolitical stress and supply chain vulnerabilities have driven a change in working capital practices. Aggressively extending supplier terms as a primary source of working capital can leave corporates vulnerable. They are increasingly cognisant of the strain it can place on their suppliers and are looking for resiliency, not risk. 

Global events such as the COVID Pandemic, shipping bottlenecks and geopolitical tension have highlighted supply chain resiliency as a strategic priority. Solutions such as responsible supply chain finance (SCF) can be used to benefit both the buyer and supplier, as SCF provides suppliers with optionality – they don’t have to take the financing, but it gives them a resiliency tool they didn’t have before. 

Dynamic discounting also provides suppliers “sliding scale” early payment, turning excess cash into a risk-free return while strengthening the supply chain. Further, having the lowest possible inventory is no longer in vogue as global events have driven unpredictable supply chains. The post-pandemic overcorrection of stockpiling is outdated, as that inventory is trapped working capital. 

Clients have been using predictive modelling to maintain the minimum required inventory to meet demand without weighing down their balance sheet. 

Laura Galvin (LG): Several practices are becoming outdated as our clients adapt to new technologies and to economic and geopolitical pressures. From rigid credit policies in favour of dynamic credit assessments using real time data; to static inventory management in favour of data analytics to optimise supply chains; single channel financing in favour of diverse financing options including government support from export credit agencies (ECAs); and fragmented invoice-by-invoice approach to supply chains in favour of collaboration, speed, and strategy, just to mention a few. 

Clients are becoming increasingly focused on strategic working capital optimisation, with the resilience of their supply chains a key success metric enabling companies to meet delivery commitments, fund innovation, and fulfil cross-border program execution. 

DU: How can working capital solutions move away from standardised products toward financing that is uniquely tailored for individual supply chains?

HC: Technology is driving us towards flexible solutions that can be unique and innovative. An exciting area to watch is digital instruments, as legal and technology reform meet, we will see increased adoption of electronic bill of exchange (eBOE) and electronic bill of lading (eBL).

Tokenisation of assets is another area of interest, as it enables fractionalised ownership with new investor opportunities. 

Finally, centralising working capital solutions into a single platform is allowing corporates to utilise multiple working capital solution-based suppliers and liquidity needs such as sales finance, SCF and dynamic discounting. These integrated tools provide clients with the optionality to achieve their working capital, cost of capital, or supplier relationship goals.   

LG: In terms of tailored working capital solutions, we have seen governments and ECAs adapting to economic and geopolitical events by continuing to innovate and offer flexible solutions in support of industrial strategies including untied financing, domestic programmes (re-shoring), and critical minerals initiatives. The ECAs have evolved beyond tied financing solutions and transaction support to promoting national interests and resilient supply chains. 

They are also facilitating balance sheets much earlier in the corporate lifecycle through flexible programs such as support for critical minerals with offtake contracts, unlocking government-backed financing for strategic offtake agreements and “shopping lines” to support current and planned expenditure.

DU: Embedded finance is becoming the new standard. What does this mean for supply chain finance?

NC: It’s all about ease of use. Corporates are busy, and their tech budgets are stretched. Nobody has the time or resources for a big, complex tech project. So, the solutions that hook neatly into the ERP will win every time. 

One of my favourite product innovations last year for J.P. Morgan Payments was our partnership with Oracle, which doesn’t even require an integration – the solution is already there in our client’s Oracle dashboard just waiting to be switched on. 

HC: Frictionless acceleration! Working capital solutions can be ‘turnkey activated’ instead of having to prioritise a technical implementation. Increasingly corporates look to their providers to do the heavy lifting to implement a working capital solution, both upfront and in the long run. 

Within J.P. Morgan Payments, supply chain finance (SCF) is no longer a standalone product, but rather a native feature of our clients’ operational ecosystems. By embedding our liquidity directly into platforms like Oracle Fusion Cloud and SAP, SCF is an integrated treasury project – a “native button” within the existing ERP.

DU: How can working capital incentives serve as a mechanism for de-risking the social and environmental resilience of supply chains?

NC: The news is making the world feel a bit unpredictable. Supply chains have had to adjust very fast to tariffs and other geopolitical changes, and the impact of that has not yet been truly felt in the global trade numbers; 2026 may be the year we see it. 

Large corporates are rolling out some pretty smart resiliency work, both in terms of mapping out where unexpected change can come from, and preparing to react quickly and efficiently. Importantly, that doesn’t just mean preparing for the worst, but also preparing to seize new opportunities as they arise. 

And as always, if you’re a strategically minded treasurer, you should be thinking not only about the impact on your own business, but also the impact on your critical customers and suppliers. There are ecosystems such as AI data centres and defence where huge demand shocks are currently rippling down the supply chain. 

If you are a corporate dealing with a suddenly full order book, you should be thinking about the impact of that on the working capital of your tier two and three suppliers, and how you can help.

DU: What role can technology play in implementing and scaling supply chain finance programs?

HC: Technology is the ultimate accelerator of SCF solutions. Clients can now simply ‘activate’ an SCF program from their native ERP software without the interruption of an elongated technology project. Couple that with digital supplier onboarding through front-end portals and the ability to utilise the open sources to enrich and validate data in the enrolment process, and clients can rapidly scale their program to suppliers of all sizes.  

AI can also help corporates identify opportunities for payment terms optimisation and create efficiencies for digital supplier campaigning, and it can help to manage supplier risk and highlight potential early warning indicators. 

Adoption of emerging tokenisation technology is also delivering value through immediate cross-border working capital and reducing risk within the trade finance space. 

DU: How is export finance evolving as supply chains are reconfigured by geopolitics and regulation? What makes for a resilient working capital strategy?

LG: The role of export finance in the working capital lifecycle of our corporate clients is growing, with ECAs acting as a reliable source of liquidity, flexibility and resilience throughout the cycle. 

A key pillar of any resilient working capital strategy is diversity in funding sources; mitigating risks associated with dependence on a single source; allowing for access to funding when needed; and featuring the ECAs as a source of strategic and competitive liquidity.