HSBC has built its own proprietary AI trade document processing system that is already active in three markets, bucking a trend of banks using off-the-shelf fintech platforms.
The London-headquartered lender, which bills itself as the world’s largest trade bank, said its Smart Checking platform will standardise the way it processes, traces and checks trade documents, and claimed the modernisation can help speed up transaction times for its clients.
Smart Checking uses “proprietary AI” to handle high-volume and repetitive tasks “while freeing experienced specialists to apply their judgement where it has the greatest impact”, HSBC added in a statement.
The technology is being used in Hong Kong, the UAE and the UK, and will be rolled out globally “over time”, the bank said.
“Smart Checking is an ideal combination of AI and human expertise,” said Thomas Elliot, HSBC’s chief operating officer for global trade solutions. “AI handles the scale and complexity of documentary trade, while human judgement is essential to understanding exceptions and making the decisions that matter.
“By co-creating the solution with our trade experts, we are building technology that boosts efficiency, practicality and innovation,” he said.
HSBC had not responded to GTR’s questions about the system at time of publication, such as any impact it will have on trade operations jobs.
Trade finance remains heavily reliant on paper documents and PDFs to process often high-value transactions, many of which staff must carefully check for regulatory compliance and to verify whether the documents constitute a complying presentation under a letter of credit arrangement.
Banks have seized on AI to try to automate the process, even before large language models became widely available. But most global trade lenders have turned to third-party providers instead if developing their own systems.
JP Morgan and Lloyds chose Cleareye, Deutsche Bank and SMBC selected Traydstream and BNP Paribas and ING use Conpend, according to the providers’ websites and announcements.
Trade finance software providers have also inked partnerships with vendors to incorporate AI doc-checking services into their broader product suite.
Standard Chartered announced in 2019 that it had developed an AI engine for trade document checking in partnership with IBM, but it is unclear if the system is still being used.
