In 2019, the ITFA Fintech Committee launched a technology initiative dedicated to the digitisation of negotiable trade instruments. Find out how the International Trade & Forfaiting Association (ITFA) engaged Enigio in this journey and what the partnership offers to financial institutions and their clients.
At a time when digitalisation is taking off worldwide, international trade continues to rely heavily on physical paper documents yet there is enough technology available for improving trade document processing. However, most of the existing solutions feature a silo-based data strategy with standardisation efforts that make it increasingly difficult for trade finance partners to come on board.
Digitalisation solutions that require onboarding of all users, a specific rule book and the setup of specific systems and processes to integrate them into digital islands slow down the move towards digital evolution as every new client who joins will still have to use physical paper documents to communicate outside of the platform.
The world of trade finance needs a solution that will help reduce this level of friction in international trade thus enabling multiple participants to exchange trade documents using current underlying systems and in a frictionless manner.
Enigio’s trace:original that entirely enables digitalisation of the trade documents themselves, is capable of revolutionising the trade sector as it is, not to mention the by-product of reduced costs and improved efficiency.
The ITFA DNI Initiative and dDOC Specifications
The International Trade & Forfaiting Association (ITFA) has established the Digital Negotiable Instruments (DNI) initiative to digitise guarantees, bills of exchange and promissory notes in the most pragmatic way.
Furthermore, ITFA developed “digital document” (dDOC) specifications that provide a vendor-agnostic technology-based framework to enable digital original documents to act the same way as paper originals which has also been endorsed by the ICC DSI as an MLETR-compliant framework.
Since trace:original is a new technology and ITFA aims to ease the bank – corporate – fintech relationships, particularly in terms of discovery, understanding and piloting of new technology propositions, ITFA and Enigio have partnered as part of the DNI Initiative and released the ITFA dDOC Manager demo application.
The ITFA dDOC Manager demo application
With the ITFA dDOC Manager powered by trace:original, it is possible to create and manage dDOC compliant digital negotiable instruments.
André Casterman, Chair of ITFA Fintech Committee, states,
“Members of the DNI Initiative have been working together for two years to deliver collaborative solutions around digital trade documents such as bills of exchange and promissory notes. Through the dDOC Manager demo portal, we offer financial institutions and their clients a way to discover the trace:original technology and assess its potential with no need for time-consuming proof-of-concept and trial contracts.”
The dDOC Manager is an opportunity for financial institutions, corporates, fintechs and platforms to understand trace:original, a unique document technology to create and manage digital negotiable instruments and documents of title in accordance with the MLETR.
With the demo environment, all ITFA members can freely test all the steps to digitally create, exchange and manage any type of documents such as bank guarantees, bills of exchange, promissory notes, bills of lading etc.
The objective of launching the demo system is for anyone to understand the necessity and the usability of digital original documents across various platforms and channels including e-banking, EBICS and SWIFT’s FileAct. Moreover, anyone can assess the impact that the integration of technology brings in their own environment and the communication with other key stakeholders.
Companies using trace:original
Enigio’s trace:original has been integrated with China Systems’ Eximbills and Finastra’s Fusion Trade Innovation to enable all their bank and corporate customers to easily start creating and managing digital original documents, removing the need for a platform, central registry or central document repository.
While sharing his views, Joel Schrevens, Solutions Director of China Systems, says,
“Trade documents are the key enablers for all decisions in trade processing flows. Considering the sheer number of participants to such flows, we should aim for an ‘Open Trade’ environment, whereby documents should have the same reach when delivered via physical/paper as via digital courier services, i.e., neither requiring onboarding of document recipients to a shared platform.”
Explaining why China Systems has invested in the integration with the trace:original solution, he adds,
“Enigio’s trace:original technology supports such ‘Open Trade’ environment as it leaves the definition of digital document contents and standards to the industry; it also does not limit the channels and platforms through which a digital document can flow. It thereby provides the most frictionless and secure solution for introduction of digital documents, which is essential from a transformational and ‘digital inclusion’ point of view. ”
Joel further notes that the simplicity but also the key strength of the solution lies in the Public Digital Notary service which allows any recipient of a digital document to perform real-time document integrity, originality and – most importantly for negotiable documents – ownership checks, without any access to business data. In his words,
“It has allowed us to digitally re-engineer current paper-based trade instruments reusing the same infrastructure in a fast, efficient and cost-effective way, and thereby to future-proof our solution.”
Anastasia McAlpine, Head of Product Trade and Supply Chain Finance at Finastra, says,
“The ITFA dDOC Manager offers an opportunity to experience the digital-at-source original documents and their benefits compared to the conventional paper-based alternatives”
“The adoption of the Digital Trade accelerates becoming the industry standard. We encourage market participants to experiment with Enigio’s trace:original via the ITFA dDOC Manager and look forward to welcoming customers into the era of digital trade reality through the open integration of Enigio’s trace:original with Finastra’s Fusion Trade Innovation.”
Click here to learn more about the ITFA dDOC Demo environment.
Sign up for the ITFA dDOC Manager.