In 2019, an estimated value of US$800b to US$ 1.5t of trade was enabled digitally, accounting to up to 6% of total global trade. With more players looking to maximise business operation efficiency, digital trade is predicted to account for more than 70% of all global trade flow in the coming decades. Digital transformation has paved the way to replace legacy issues of trade with speed and cost efficiency.
The main driver in cost reduction is accredited to the innovation of technologies present in trade. With ever evolving and improving technologies such as optical character recognition (OCR), robotic process automation (RPA), artificial intelligence (AI) and blockchain, trade finance is in the middle of a period of intense disruption of digitalisation.
It is our responsibility to stay on top of these faecets and more, to provide an edge to our customers, in speed, convenience and accessiblity in a scalable and sustainable manner.
When processes are digitalise, the need for data to be accurate, timely, compliant to today’s standards, is important. Without these characteristics, data is irrelevant and potentially costly.
Over the years, in light of a short term issue, many protocols and requirements have been setup to address certain shortfalls but was never considered thoroughly or been taken out post-addressing these issues.
A major part of what we do when we digitalise is to also to streamline and reduce steps stemming from legacy issues.
The only one of its kind in the world, our ecosystem bypasses long-standing barriers to entry in global trade, digitalising and radically simplifying the processes in UN/CEFACT’s BUY-SHIP-PAY model.
As technology continue to improve, we see a vast opportunity for the trade finance space to take advantage of this. Although this might not mean more trade finance can be supplied by banks, we can expect better cost reduction, transparency and security for each transaction.
As we do not expect this evolution to be quick nor simple, a displacement of banks’ primary role will take place over time. With technology’s help in shaping trade facilitation, we see many alternate players such as ourselves and many more, offering flexibility and speed to customers compared to the traditional ways.
At GUUD, we see trade finance as a space with vast potential for growth digitally. Our products and services will only be limited to our imaginations.
