OCBC Bank has become the first bank to leverage Singapore Customs’ electronic banker’s guarantee programme, issuing an electronic banker’s guarantee (eBG) to Singapore Customs on behalf of vCargo Cloud, an infocomm technology solution and service provider that performs customs declaration services for forwarders and shippers.
OCBC Bank’s API connectivity with the Networked Trade Platform has enabled the bank to electronically transmit details of its customers’ eBG to Singapore Customs. As a result, the time taken from application - which can be done via the bank’s business online banking platform Velocity@ocbc - to delivery of the Banker’s Guarantee to Singapore Customs, has gone from 7 working days to 1 working day.
Businesses benefit from this more efficient process as it mitigates the risk and costs that result from delays and disruptions to their imports into Singapore.
“It has taken some time for trade finance to be digitalised, but the momentum has picked up over the last few years,” said Melvyn Low, head of Global Transaction Banking at OCBC Bank. “Already, close to half of our trade transacting customers who were previously sending in paper trade applications are now doing so via our internet banking portal Velocity@ocbc. And now, with this inaugural eBG, we have seen the end-to-end digitalisation of the banker’s guarantee process, which is a milestone for the trade industry’s digital transformation. This digital transformation can only happen when likeminded partners come together - Singapore Customs has been great to work with and we are excited to continue our partnership with them.”
“The electronic banker’s guarantee programme is part of Singapore Customs’ continuing efforts to digitalise and simplify Customs documentation processes to make trade easy,” said Lee Boon Chong, senior assistant director-general of Trade at Singapore Customs. “It will also help us to lower the risk of fraud through guaranteed data authenticity from source and streamline our processes.”
As a declaring agent, vCargo Cloud has to furnish banker’s guarantees to Singapore Customs to cover the payment of duties, taxes and fees.
“Previously it took us seven working days from application to our delivery of the banker’s guarantee to Singapore Customs,” said Tan Tian Soo, CFO at vCargo Cloud. “Now we just need to apply on Velocity@ocbc for eBG, and it was delivered to Singapore Customs on the same day. Details of my banker’s guarantee are transmitted to Singapore Customs electronically, facilitating a more efficient lodgement process. We were also able to track real-time on Velocity@ocbc when our banker’s guarantee was issued. The end-to-end BG process was seamless, giving us peace of mind to better focus on our business.”
The digitalisation of trade financing
In order to make the trade financing process quicker for its customers, OCBC Bank has been constantly updating Velocity@ocbc, adding new features while ensuring a simple, intuitive interface. Today, the number of its customers transacting trade online has grown in the past year by four times. The banking platform allows customers to have a holistic online experience from submitting trade applications, to receiving timely transaction status updates and making remote authorisations using their mobile phones.
In addition, OCBC Bank supports CamelONE Trade Finance on NTP which allows users to subscribe and apply for up to 12 trade finance products via standardised forms in a secure format. Users can conduct simplified paperless trade finance applications through the reuse of their digital trade documents and data via the NTP and receive real-time status updates on their applications.
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