Finnish technology firm Nokia and three banks have partnered with Traydstream to pilot its machine learning solution for trade finance-related document checks.
The pilot programme, which involves OP Group, SEB and Standard Chartered, has commenced and will run for 10 weeks.
Traydstream is a trade finance-focused fintech company. Its application uses OCR (optical character recognition) to read, scan and structure paper-based information digitally – essentially digitising the full trade transaction. Its machine learning engine then automatically processes and checks the documents for anti-money laundering and compliance issues.
“In a full production environment, Nokia will check the documents through the Traydstream platform, fix any errors, and then send them directly to the bank, who can move forward with it straight away, because they are getting completely non-discrepant, clean documents that they can then process much faster,” Uzair Bawany, chief revenue officer and co-founder of Traydstream, tells GTR.
Within many banks, this document checking process is still a manual, labour-intensive job, and often involves sending documents back and forth multiple times to fix errors. Bawany says the average time for a bank to conduct a document check today is about four hours. Traydsteam is looking to reduce that time to minutes.
“With our solution, everything gets sped up, which helps Nokia from a working capital and a payment point of view,” he says. “It doesn’t have to wait for the banks to do all those checks and come back to it to fix errors. And from the banks’ perspective, they don’t need 20 guys sitting there doing the checks manually.”
During the pilot programme, the parties will feed the machine learning engine with documents in order to train it on how to read and structure the data, and evaluate the concept.
Bawany says the plan is to then go live with the three banks and possibly also expand to more of Nokia’s financial partners.
Founded in 2015, Traydsteam went live with its first bank client late last year, after concluding a US$3.5mn pre-series-A financing round to scale up its offering.
The fintech firm has already carried out a series of pilots with major players, including a leading Southern European trade finance bank and a big Japanese bank, but has recently seen interest from corporates who are equally interested in improving the document checking process.
In a statement, Jari Hänninen, Nokia’s head of structured finance calls the Traydstream solution a “game changing piece of technology within the document trade process”.
“We are entering into this pilot with the real intent to get a straight-through process for our documents whilst ensuring that we adhere to the stringent policy requirements of our banks. Their support in this pilot is therefore vital,” he says.
Traydstream has offices in India, Pakistan, Dubai, Italy and the UK. It plans to make available a second release of its solution this year, which will implement blockchain technology. “The first step was to accelerate processing, automate it, and make it exceptionally fast at an individual level. If you give the solution to a bank, it would be much faster, cheaper and more efficient than today, and the reliance of humans comes down drastically,” said Traydstream’s CEO Sameer Sehgal, speaking to GTR last year. “However, with blockchain, you can get the other parties constituting a transaction to partake in that transaction at the same time, which does not happen today. With blockchain you can make data available right away for them to process in a distributed manner.”
Traydsteam is not the only young fintech player using new technology to automate what is today an extremely paper-based and manual industry. Conpend is another firm that helps clients digitise trade documents, flag deviations and conduct automatic document checking and sanctions screening. It recently announced it is working with Germany’s Commerzbank to integrate the system into its back office, with the bank claiming to be able to automate 80% of its “first line of defence” compliance checks of its trade finance processes by 2020.