In a global emergency, international trade may slow but it must not stop. Even as COVID-19 reveals the shortcomings of a paper-based trade system, financial institutions (FIs) are finding ways to keep trade circulating. How are they doing it? Read this joint paper published on April 23, 2020 from BAFT, the ICC and the ITFA entitled ‘How Banks Are Going Digital To Manage COVID-19’.
This paper, jointly published with the ICC and the ITFA, collates common practices undertaken by global banks in the COVID-19 emergency situation and shares some guidance. This is not a “best practices” document and many of the practices described are being improved already. Rather it is a practical reference document with information about measures put in place to continue the flow of trade and trade finance when paper transfer has become difficult or impossible.
The COVID-19 pandemic has disrupted shipping, in-person interactions, and travel. As such, alternative procedures are required to settle trade finance transactions. Data is sourced from 2020 data from ICC, ITFA and BAFT members.
This brief shares the ad hoc practices being implemented by FIs under the COVID-19 pandemic. Their approaches are different from every previous global crisis in that responses target the singular problem of how to keep trade flowing when physical interactions are impracticable. The document makes clear that these quasi-digital solutions are interim only until actual e-enabled digitized solutions are fully developed.
Read the full paper from the ICC Digitalisation Working Group in the Library of Documents page under White Papers.