ANZ, Banco Santander, BNP Paribas, Citi, Deutsche Bank, HSBC and Standard Chartered have announced a joint initiative to build a digital network.
The banks will introduce the network, which will be operational by the end of 2018, at the SIBOS conference in Sydney, Australia, on October 22 2018. It will become the first global multi-bank, multi-corporate network in trade finance.
The network selected CGI as its technology provider. GCI has completed the pilot version of the network and CGI will continue to support the development of the trade information network.
The global digital network in trade finance aims at allowing cheaper and easier funding for corporates, Reuters reported.
The platform could finance a significant part of the $1.5 trillion demand per year for trade finance from small and medium sized companies that is currently not met by the industry due to higher costs and risks.
In addition to the founding banks, more than 20 additional banks are participating in developing the network and 60 corporates have already expressed an interest in participating in pilots.
Corporates will be able to submit and verify purchase orders and invoices to request trade financing from the banks of their choice. By providing those banks with access to trade information, the network will help to mitigate the risk of double financing and fraudulent trade information across the industry.
The network has open architecture and standardised connectivity based on a governance model similar to SWIFT to achieve maximum adoption across the supply chain ecosystem. Corporates will use a simple one-time registration process which will allow them to connect with all banks on the network.