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Industry roundup: 22 February

SEB and Wärtsilä participate in paperless trade finance experiment

The technology group Wärtsilä has participated in an co-creation project aimed at digitalising the export letter of credit (L/C) process, which currently is handled manually and by email using paper documents and PDF files. The results of the experiment indicated clearly that physical documents can easily be replaced with secure and standardised data sets that enable automated processing. 

In addition to Wärtsilä playing the role of an exporter, the other companies participating were SEB as the L/C advising bank, Digital Living International which implemented the fully digital L/C document exchange based on Finnish Innovation Fund Sitra’s data sharing platform called IHAN testbed, and Nixu Corporation which supported the process with its cyber secure digital identity and security solutions. 

The purpose of the experiment was to show that corporate data sharing can be executed technically, functionally, with good governance, and without the fear of critical business information being misused.

"As a global company, we are constantly handling commercial transactions with customers and banks around the world, and this experiment involving collaboration with qualified partners seeks to not only increase the efficiency of these dealings, but also to mitigate possible risk," commented Jarmo Nurmi, corporate treasurer at Wärtsilä.

The participating co-creators point out that a data-based system will make smoother market practices available, and that it is easy to implement and integrate with standard and open application programming interfaces (APIs) controlled by the data sharing and consent management mechanism. This eliminates the fear of data copying and its use without consented access.

The project was commenced in 2020 with planning based on design-thinking. While the experiment could only cover part of the overall L/C process, it was nevertheless able to determine that automated processing is possible within trade finance stakeholder systems. It also proved that this can be done in a platform, system, and process agnostic manner which can be gradually extended.

 

Northern Trust expands FX currency management services footprint 

Northern Trust has announced strong demand for its foreign exchange (FX) currency management services with a number of new mandates over the past 12 months. The appointments to provide a full suite of currency management services span newly onboarded clients including Blackwall Capital Investment, Kieger and TT International Asset Management, in addition to expanded services for existing clients including AMX (The Asset Management Exchange) and Rockefeller Asset Management.

"A combination of rising operational costs, governance pressures and regulatory requirements are encouraging asset managers and asset owners to delegate their FX currency hedging to a specialist third-party who can efficiently manage FX risk, enabling them to focus on their core investment process," said John Turney, global head of Foreign Exchange at Northern Trust. "This trend has been further accelerated by the COVID-19 pandemic, which has heightened the need to respond quickly to market events in order to manage and mitigate currency volatility in global investment portfolios."

Northern Trust’s currency management suite comprises share class hedging, portfolio overlay and ‘look through’ hedging solutions to help asset managers and asset owners manage and mitigate currency volatility for their international investment portfolios. The automated solutions are set to agreed client parameters to deliver active monitoring against target hedge ratios, unrealised P&L views, real-time performance attribution analytics and detailed transparency and oversight dashboards.

Northern Trust recently introduced machine learning models designed to enable greater oversight of thousands of daily data points and help reduce risk throughout the currency management lifecycle, in conjunction with its strategic partner Lumint Corporation.

 

Revolut Business launches QR codes

Following its announcement late last year of its introduction of a remote payments solution for customers, Revolut Business has launched QR codes that allow for socially distanced payments. Business owners can access QR codes on their phones using just the Revolut Business app, without needing to purchase any additional devices.

This touch-free feature allows for instant payments using internet connectivity, so business owners can check that the payment is successful in the presence of the customer. Business owners can use their Revolut Business app to generate a QR code which the customer can scan with the camera on their phone, all while maintaining distance. The customer will then receive a prompt asking them to pay with Apple Pay, Visa or Mastercard and they can complete the payment from their own iOS or Android device.

Revolut Business customers in the UK, Austria, Belgium, France, Denmark, Germany, Ireland, Italy, Netherlands, Poland, Portugal, Spain, Sweden, Bulgaria, Croatia, Czech Republic, Estonia, Finland, Greece, Hungary, Lithuania, Luxembourg, Norway, Slovakia and Slovenia can use QR codes. To enable QR codes, users need to update the Revolut Business app to at least version 2.28 in the iOS or Android store. 

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