Surecomp has processed the first trade finance guarantee using an application programming interface (API)-based standard designed by Swift and the International Chamber of Commerce (ICC).

The request was performed through Surecomp’s collaborative trade finance platform Rivo, and was sent from Dutch logistics company Vanderlande to BNP Paribas in real time without manual intervention.

Surecomp, a trade finance software provider, describes the initiative as a low-cost way to use digital guarantees that will particularly help corporates with low transaction volumes.

APIs “promote greater agility” for corporates, a Surecomp spokesperson says, and do not require participants to be connected to Swift’s messaging platform, making them less expensive than traditional guarantees.

The new standard is compatible with Swift’s old MT798 format, which has traditionally been used for processing bank guarantees, as well as the ISO 20022 standard, which aims to create a single format for financial transactions across different systems, platforms and geographies.

“API-first solutions are the key enabler to lowering thresholds to digital trade transformation,” says Enno-Burghard Weitzel, Surecomp’s chief solutions officer. “By using our Rivo platform as a centralised hub, banks, insurance companies and corporates can connect in real-time and now leverage the Swift-ICC API to execute faster, more efficient guarantees, which will ultimately improve cash flow and drive trade growth.”

Marie-Laurence Faure, head of digital trade channels at BNP Paribas, says the pilot “is the beginning of a new and very promising journey in the digitalisation of bank guarantees. It is a significant industry milestone, and we invite all other trade finance stakeholders to join this initiative for the benefit of the entire ecosystem,” she adds.

APIs are protocols and rules that allow software to speak to one another, and they have been gaining traction in the trade finance world as digitalisation efforts have ramped up. However, innovation has brought with it proliferation, meaning there are currently a plethora of different APIs in use. Shirish Wadivkar, Swift’s global head of wholesale payments and trade strategy, told GTR in an interview last year that this was one of the key problems that its collaboration with the ICC aimed to solve. “There is a clear need to create some uniformity in the industry,” Wadivkar said.

“There hasn’t been a uniform standard for APIs to accompany their growing usage and adoption across corporate-to-banks channels. A proliferation of standards slows down widespread adoption and growth.”