Related News

Trade finance results: Europe steady, Middle East and Brazil grow

Standard Chartered first major bank to adopt ICC’s sustainable trade finance principles

Germany aims to boost struggling industry with export credit revamp

Australia needs more than MLETR to digitise trade: NAB

ICC UK launches updated digital trade roadmap

A group of trade and technology veterans have set out plans to develop an open-source protocol that bridges gaps between different platforms, banks, buyers, sellers and other parties seeking to digitalise trade. 

The project will be undertaken by the Verifiable.Trade Foundation (VTF), a Basel-headquartered organisation formally launched this week.  

It plans to provide a protocol – similar to those used for web browsing or email – that can retrieve, standardise and exchange trade-related data without users having to join platforms or set up new systems. 

“Global trade is the backbone of economic prosperity but despite its importance, the industry is plagued by outdated, paper-based processes, inefficiencies, and a fragmented digital ecosystem,” VTF says. 

“While multiple solutions exist, most are proprietary, creating digital silos that fail to address industry-wide challenges.” 

The foundation says that while many digital trade platforms are already in existence, they each “seek to profit from their own proprietary solution, causing complexity, distrust and a lack of control when data is exchanged between platforms”. 

“Several solution providers have failed due to complex integrations and the lack of adoption by banks and regulators,” it says. “This creates significant barriers for international trade growth.” 

Its vision for an International Secure Trade Transfer Protocol (ISTTP) plans to enable trade participants to verify their identities and exchange trade-related data and documents in real time. 

The foundation says ISTTP will be open source, not-for-profit and interoperable across different digital trade platforms and internal systems, and accessible to businesses of all sizes. 

The foundation’s board is chaired by Stephan Wolf, chair of the industry advisory board at the International Chamber of Commerce’s Digital Standards Initiative, and former chief executive of the Global Legal Entity Identifier Foundation. 

Other founding members joining the board include Chad Pasha, Daniel Cotti, Hans Huber, Timothy Ruff, Daniel Sauberli and Thibault Serlett, who collectively bring experience from financial services, trade technology, digital identity, government and several other areas. 

Speaking to GTR ahead of the foundation’s launch, Wolf said the project grew from concerns that focusing only on standardised data, exchanged via APIs, would be a “big mistake” for industry participants seeking to digitalise trade. 

“Take the electronic bill of lading discussion (eBL) that we see all around the world,” he says. “Everybody is convinced that we should use eBLs, but then when you look at the implementation, you will find multiple platforms that are all doing it differently and cannot talk to each other.  

“I do not believe in a central, global platform, a one-size-fits-all approach. There is an interoperability layer missing, and that can only be established through open protocols, available to everyone for free.” 

Huber, a former Commerzbank project manager for trade finance innovation, cites the HTTPS protocol that created the World Wide Web and those used in telecoms that allow users anywhere to connect regardless of the provider or system they are using. 

“And we have email, where protocols mean it’ll always work and I don’t have to care about your choices or your work environment,” he tells GTR. 

“We are now creating the same thing for the commerce space, across the whole physical and financial supply chains, and for all actors involved.” 

Wolf says the project will initially be directed at buyers and sellers, with the foundation developing trade data gateways that can collect and submit data from different platforms those companies use, and translate it into the protocol’s open-source standard. 

“There will also be a repository of all messages exchanged, to create an audit trail,” he says. 

As well as seeking funding, VTF now plans to partner with trade associations, standards organisations, financial institutions and regulatory bodies to lay the groundwork for industry-wide adoption, it says.