Paperless trade finance
Some 90% of global trade relies on trade finance. However, the trade worth $17 trillion runs with 4 billion paper documents yearly which means the required data, for instance in a Letter of Credit (L/C) process, cannot be efficiently shared between stakeholders. The International Chamber of Commerce (ICC), the advocate of the entire industry, has set its vision and roadmap for the new digital era of trade finance. But business ecosystems themselves still lack openly available practical governance models, standards and technical capabilities for corporations to share data in a trusted and scalable manner without heavy point-to-point integrations.
Wärtsilä together with SEB entered into a pilot experimentation on the IHAN testbed to try out its capabilities and potential to provide a solution to start digitalising the trade finance processes. Wärtsilä, in the role of an exporter, and SEB, in a role of an advising bank, experimented with mutual data sharing by standardising and exchanging L/C export instructions as well as L/C presentation data on the IHAN testbed and authorising the use of that data.
Although this is the first small step in digitalising international trade, the participants found the results of the experimentation to be innovative and are investigating how to take the case into production as a minimum viable product.