Despite all the fanfare for digitalization in trade finance and the revolution in changing paper-based processes, banks appear to be unmoved by the prospects of incorporating new technology into their trade business. The International Chamber of Commerce (ICC) found that the top goal for trade finance banks in the next 12 months is to focus on traditional trade finance, with 72% of survey participants selecting that option. Less than 30% see digital trade or emerging technology development as a key priority in the next 12 months. When asked whether digital schemes may be a top goal in the next three-five years, less than half saw that as an important goal.

Progress in developing digital trade finance is slow, with only 12% of banks stating that they had implemented a technology solution. Moreover, out of that sample about 9% had found that digital solutions have increased efficiency. The lack of a measurable impact could be an obstacle for stakeholders (governments, technology and trading companies) trying to justify an overhaul. Boston Consulting Group believes that an integrated digital solution incorporating intelligent automation, collaborative digitization, and future technology would save global trade finance banks between US$2.5 billion and US$6 billion on a cost base of US$12 billion to US$16 billion.

The push to update trade finance processes typically comes from client demand. While cost savings are clearly a boon for the bank, clients themselves need to be persuaded. In May 2018 Cargill (a US food company) along with HSBC and ING executed a soybean shipment transaction, from Argentina to Malaysia. Using blockchain to validate trade documentation, Cargill cut the document exchange time to 24 hours, from five to 10 days.

From fintech partnerships to government schemes, efforts are being made to spur trade digitalization. Yet, for digitalization to accelerate more work needs to be done to show end-users concrete benefits.