To what extent has “resilience become the new efficiency”? For Kai Fehr, HSBC’s Global Head of Industry Groups & Partnerships, there is a requirement to embed resilience into every layer of trade finance, to navigate a global trade landscape fraught with geopolitical risk.

At the 2025 Sibos conference in Frankfurt, Germany, Fehr sat down with Trade Finance Global’s (TFG) Mahika Ravi Shankar to discuss the key factors undermining supply chain resilience, the innovations strengthening it, industry-specific approaches, and what the future may hold.

The forces affecting supply chain resilience

Fehr separates the factors making supply chains less resilient into two groups: those businesses can control, and those they cannot. “What obviously comes to mind is war, geopolitical tension. You have a shift in supply chains triggered by a pandemic which is not so far away. So all of that is not in the control of our clients,” he explained.

The COVID-19 Pandemic feels like a distant memory of masks and social distancing. But where many remember toilet paper shortages as a headache in the supermarket, the product resembles a hangover from the pandemic, which many businesses still contend with: that COVID-19 was an unprecedented global shutdown and therefore highlighted the vulnerability of supply chains. In fact, an Ernst & Young (EY) survey of senior-level supply chain executives found that 72% reported the pandemic had a negative impact on their company, with 57% facing serious disruptions. 

The same EY survey, conducted in 2020, 2022, and again in 2024, consistently placed visibility among the top three executive priorities, aligning exactly with Fehr’s observation regarding controllable factors affecting resilience. “Clients are realising that their supply chain may be too long… Are you reliant on a single supplier? A single logistic route? A single supplier market? All of that you can change, and we see our clients changing this.”

HSBC’s TradePulse survey of 2,000 clients revealed that nine out of ten have, or are planning to invest in, supply chain visibility tools, adopting automation in production or logistics or enhancing data analytics to this end.

Having outlined pressures eroding supply chain stability, Fehr turned to the innovations within trade finance that are helping resilience, from the emergence of marketplaces to deep-tier financing and platform banking. 

Innovations in supply chain resilience

Marketplaces

The rise of digital marketplaces is one of the clearest innovations for Fehr. Within the supply chain context, a marketplace is essentially a digital platform where multiple buyers and sellers connect, transact, and in some cases access financing in one place.

One form is client-driven marketplaces, which enable both sales and procurement. “Large clients start creating their own marketplaces for the procurement side as well as the supply chain side,” explained Fehr.

The other is third-party marketplaces, which bring together external buyers and sellers. As Fehr noted, “This is when you merge cash and trade into embedded finance. That is something you can be excited about.” When marketplaces merge trade and finance, they strengthen resilience.

Visibility and simplicity

For Fehr, another critical innovation lies in visibility – understanding not just the company’s direct suppliers, but the multiple layers that sit beneath them. Deep-tier financing, which extends financing down to second and third-tier suppliers, allows banks to provide transparency across the supply chain while ensuring that liquidity reaches the points where it is most needed. 

“In a market like China, where we are enabled for deep-tier financing through various platforms and ecosystems, we can support supply chains all the way down to level one, level two, and level three suppliers. That gives clients visibility back into their networks and channels financing to where it’s actually needed,” he explained.

Alongside visibility, Fehr highlighted simplicity as a crucial step in building resilience. For many treasurers, managing multiple banking portals across different institutions serves as a burden. “If I sit down with a treasurer and he shows me a big glass ball of tokens and dongles to log into each and every proprietary bank channel — that’s not easy to bank,” Fehr remarked.

To address this, HSBC is rolling out Enterprise Resource Planning (ERP) integrations such as HSBC Connect and its partnership with Oracle NetSuite, which embed payments, receivables, and reconciliation directly into a company’s ERP system. Instead of navigating separate banking platforms, firms can manage trade flows in a single environment, with HSBC acting as a ‘platform bank’.

Industry-specific tailoring

While these innovations are reshaping supply chains broadly, Fehr emphasised that effective solutions must also be tailored to the realities of individual industries. “You can only provide a solution to your client if you understand the respective ecosystem,” he said. 

In agriculture, for example, Fehr noted that clients have proven remarkably resilient — finding ways to maintain food supply chains even during crises. That resilience has been tested: the UN Food and Agriculture Organization’s Food Price Index jumped 12.6% in March 2022, the steepest monthly increase in over three decades. Yet, despite this unprecedented pressure, Fehr said he is “less worried about the agriculture sector,” as trading companies consistently find solutions to keep food moving.

By contrast, the technology sector is grappling with a very different set of pressures. Fehr pointed to the surge in data centre construction, driven by rapid digitalisation and the expansion of AI, which has created significant inventory challenges. 

“If you look at the end-to-end supply chain, it’s not only the payable side and the receivable side – in the middle, you have inventory. That is where we are partnering with clients to find solutions, and the biggest current application for this is in the tech sector,” he explained.

The contrast between agriculture’s resilience and technology’s inventory needs shows why a one-size-fits-all approach cannot work. Each industry faces distinct vulnerabilities, and resilience depends on solutions being designed for its particular supply chain challenges.

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Looking ahead, Fehr believes that traceability and visibility across supply chains will become a baseline expectation. Transparency will be required not only around how supply chains operate and how long they are, but also around the behaviour of suppliers across different tiers. He also forecasts a shift toward data-driven models, where potential disruptions can be anticipated in advance, with alerts prompting companies to reroute or reset procurement before issues escalate.

Ultimately, once resilience becomes embedded in the entire process, it will define efficiency in supply chains.