The Role of International Trade in Enhancing Cross-border Banking Services at Barclays Bank Limited
Abstract
International traders accept payments in foreign currencies for their export and imports through banks. The payments is usually received from licensing agreements and foreign investments with foreign companies. International trade uses the foreign exchange marketplace to pay foreign companies for their products services and products and to institute direct investments in overseas nations. Several commercial banks provide long-term as well short term loan funding to international firms. Barclays bank indirectly and indirectly contributes to the development of a competitive, diversified, well-functioning, financial sector by providing the international market with a means of payment, enabling secure commercial and financial transactions, and mobilizing international and domestic savings. Financial infrastructure enables more efficient allocation of capital to productive investments, which contributes to growth and, ultimately, regional and overseas corporation. There is need to analyze the specific role of international trade in enhancing banking directly in Kenya so as to develop systems and mechanism in commercial banks to support international trade. The objective of this study is to determine the role of international trade in enhancing cross-border banking services of Barclays Bank Kenya Limited. What role does international trade play in improving cross-border bank transactions, improving inter-bank transactions and hedging foreign exchange risks? Descriptive case study research design technique was used in this study, primary data was used in the study, interview guide was used in the collection of data and content analysis was used in analysis of data. The study concludes that international trade plays an important role in improving inter-bank transactions, hedging foreign exchange risks and improving the bank transactions. This roles are improving relations among the corresponding banks in other nations and locally thus enabling ease in transacting business. It enables the banks to interact with foreign banks and exchange foreign currencies thus enhancing business transactions. Developing international trade standards is faced with challenges such knowledge gaps resulting to different interrelations of the standards, foreign exchange loss exposure, default risk-collateral or syndication, challenges of dealing with nations that are sanctioned. Structuring trade deals is a challenge involving offering of capital solutions. This study recommends that banks ought to review the policies guiding and structuring the provision of international trade finance products, and trade deals to customers with a view of making them attractive and affordable to customers. Moreover policy makers (Central Bank of Kenya) should enact policies to control transactions with nations that are sanctioned and control inferior imports by issuing heavy penalties to defaulting business persons
Publisher
University of Nairobi
Rights
Attribution-NonCommercial-NoDerivs 3.0 United StatesUsage Rights
http://creativecommons.org/licenses/by-nc-nd/3.0/us/Collections
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