Revolutionizing the Financial Markets

Winter 2016 Sponsored Section 37
7-Time Winner
GTR Magazine’s Best Trade Finance Software Provider Award
2006, 2007, 2008, 2009, 2010, 2012, 2014
a n d
2014 & 2015 Winner
GTR Asia’s Best Trade Finance Software Provider Award
More than 30 Years in the Trade, SCF and Payments Solutions Industry.
Nirvana of digitization?
As this work on digitization continues, so the inevitable
question arises of whether we are at last going to see a fully
electronic and digitized trade cycle? There is, for example, already
work underway to create the first “Blockchains” for a trade that
encompasses all the major trade events in an encrypted group
of data. This technique, pioneered through the development of
crypto-currencies such as Bitcoin, provides the opportunity to
create a trade instrument that both reconciles data throughout
the trade cycle and also enables different parties to share the
same reconciled data. In essence, for the first time the digitized
experience will not be about finding discrepancies: it will be about
providing agreements that could result in different guarantee and
financing opportunities.
This capability, when coupled with technologies such as apps,
mobile payments and collections, offers the ability to offer massmarket
trade and payment capabilities for customers in remote areas.
The ability to link the block chain through identity and authorization
on the mobile provides a clear opportunity to reach remote farmers,
with their buyers in the developed world and to leverage the credit
and capital.
Enabling developing market growth
China Systems is working with a development bank funded
project and with a mobile e-commerce and payments platform to
deliver mass market open account processing to support a major
small business enablement programme. This fully electronic
mobile solution combines the “legacy skills” of trade processing
with the mass market appeal of mobile – Blockchain would offer
a powerful future model in this scenario. By integrating payment,
document delivery and logistics, the programme will reach into
remote areas to support growing entrepreneurs and farmers. The
platform will also support syndication of risk assets to create
additional risk capacity in the trade cycle: a vital element for
capital starved growing economies, and is already attracting
attention in countries as diverse as Australia and Pakistan.
All of these influences represent a convergence of regulation,
technology and cost management. The continuing drive on cost,
the scarcity of capital and the need for transparency are at last
pushing a real change in the 300 plus year old processes that have
characterized trade operations until today.