A growing number of factors, such as global events, changing regulations, technological advancements, and access to capital, are driving digital disruption in trade and supply chain financing. These disruptors can have a significant impact on global trade, from margin pressures caused by elevated inflation to geopolitical changes that affect globalization and trade practices. The increasing complexity and fragmentation of supply chains also introduce challenges in terms of compliance and fraud mitigation. In response to these challenges, organizations are embracing digitization, standardization, and collaboration to accelerate time to value and reduce costs.

IBM is playing a key role in this digital transformation by developing the Connected Trade Platform. This platform leverages IBM’s technology and consulting capabilities, as well as digitally native business-process capabilities from multiple fintechs. It aims to create a data-driven and connected trade ecosystem by integrating disparate manual processes and platforms through intelligent workflows. With a single source of truth established across all parties, trust between trading parties can be increased, leading to more efficient and secure global trade.

The benefits of digitization, standardization, and collaboration in trade finance are numerous. Banks can gain real-time visibility into their supply chains, eliminate paper-based processes, improve working capital optimization, enhance cash-flow forecasting accuracy, safeguard transactions against cybersecurity risks, and unlock wider procure-to-pay benefits. Buyers can experience improved working capital, superior supplier performance, and accelerated environmental, social, and governance (ESG) initiatives. Fintechs can reduce adoption barriers, expand their go-to-market reach, achieve flexible integration with bank backend systems, and streamline their operations management.

The Connected Trade Platform is built on IBM Cloud for Financial Services, a cloud specifically designed to meet the needs of regulated industries. It also incorporates artificial intelligence (AI) technologies for increased productivity and efficiency. Responsible and transparent AI workflows are vital for transforming trade finance and providing cross-border assurance. IBM technologies such as watsonx.ai, watsonx.governance, and watsonx Orchestrate enable AI builders to train, validate, and tune AI models for trade, as well as automate back-office transactions using digital labor.

IBM Consulting’s Integrated Trade Finance Advisory, Integration practices, and Managed Services capabilities are instrumental in assisting clients with their trade digitization journey. With over 2,000 professionals in this domain, IBM Consulting is well-equipped to help organizations optimize trade and supply finance processes while prioritizing security and compliance.

Summary

The digitization of trade and supply chain financing is being driven by various factors such as global events, changing regulations, technology advancements, and access to capital. IBM is leading the way in this digital transformation with its Connected Trade Platform. This platform integrates disparate manual processes and platforms, creating a data-driven and connected trade ecosystem. It leverages IBM’s technology, consulting capabilities, and digitally native business-process capabilities from multiple fintechs. The platform offers real-time visibility, eliminates paper-based processes, enhances working capital optimization, improves cybersecurity, and unlocks wider procure-to-pay benefits. It is built on IBM Cloud for Financial Services, with AI technologies for productivity and efficiency. IBM Consulting’s expertise in trade finance and Managed Services capabilities further support clients in their trade digitization journey.

FAQs

1. What factors are driving digital disruption in trade and supply chain financing?

Global events, changing regulations, technology advancements, and access to capital are some of the factors driving digital disruption in trade and supply chain financing.

2. How is IBM contributing to this digital transformation?

IBM is developing the Connected Trade Platform, which integrates manual processes and platforms using intelligent workflows. It leverages IBM’s technology, consulting capabilities, and digitally native business-process capabilities from multiple fintechs to create a data-driven and connected trade ecosystem.

3. What are the benefits of digitization, standardization, and collaboration in trade finance?

Digitization, standardization, and collaboration in trade finance offer benefits such as real-time visibility, elimination of paper-based processes, improved working capital optimization, enhanced cybersecurity, and unlocked procure-to-pay benefits.

4. What is the role of AI in transforming trade finance?

AI plays a crucial role in transforming trade finance by increasing productivity and efficiency. IBM technologies like watsonx.ai, watsonx.governance, and watsonx Orchestrate enable AI builders to train, validate, and tune AI models for trade and automate back-office transactions using digital labor.

5. How does IBM Consulting support clients in their trade digitization journey?

IBM Consulting’s Integrated Trade Finance Advisory, Integration practices, and Managed Services capabilities, supported by over 2,000 professionals in this domain, help clients accelerate their trade digitization journey and optimize trade and supply finance processes.