The LiquidX team was excited to attend Global Trade Review UK 2023 with our peers – both old and new. We got to bear witness to the latest changes happening in trade finance. With so many new trends in the industry, it was interesting to see how LiquidX’s cutting-edge digital solutions can truly improve business operations.
This idea was explored deeper at the panel: What does the next digital frontier look like?
Jim Toffey, our CEO, participated in the discussion on how technological advancements have had, and will continue to have, an impact on trade finance. Most notably, digitization has been influencing how we do business. Due to fallout from the pandemic as well as changes in compliance requirements, the industry has been recognizing digitization as a must. More and more customers are seeking streamlined, cloud-based operations, while corporate treasurers are facing frustrations with traditional working practices and communicating with employees across multiple time zones.
Jim spoke on how digitization is able to reduce barriers and frictions to expand network effects and harmonize data so we can get things done faster while saving money.
By optimizing business through less demand on resources, we’re able to actually speed up how quickly we accomplish both smaller tasks as well as bigger picture initiatives. LiquidX predicts that in three to five years, we’ll reflect back on how business used to be done and the amount of progress made in terms of speed and seamlessness. Companies will no longer have to slog through manual processes, long email chains about invoices, and complex spreadsheets.
One of the ways we’ll see this in the coming years is through streamlining the implementation of various data sets – PDFs, email, spreadsheets – through digitization. In the past this process has required extremely manual and redundant tasks. With digitization, we can put all this data together in one dashboard and give companies access to this information in a timely manner.
Jim also addressed how digitization will impact the KYC process. Financial institutions have been suffering from a severe shortage of skilled KYC analysts and compliance personnel, resulting in huge backlogs in Customer Due Diligence (CDD) reviews. While banks are trying to outsource efforts to low-wage countries, many are finding that these expenses are adding up.
Instead of throwing more manpower at the problem, financial institutions will need to streamline the whole KYC process by digitizing operations. This will not only lower operational costs, but also unlock KYC and solve credit, compliance and risk faster. Digitization will also empower banks to enforce ESG standards down the road.
Digitization will become so critical in the future, companies that chose not to embrace it will have stalled growth, impacting the industry at large. To learn more about the direction the industry is headed and how you can prepare with digitization tech, reach out to our team or request a demo.