HSBC and IBM work together to develop cognitive trade finance tool
IBM and HSBC are developing cognitive intelligence technology that can be used to boost the success of financial services, freeing up staff time and allowing for more innovation.
The solution, which is already in use in Hong Kong and the UAE, uses IBM robotics technology to analyse documents, digitising and extracting the relevant data before feeding it into HSBC’s transaction processing systems.
It can analyse the 100 million documents HSBC's Global Trade and Receivables Finance (GTRF) team currently has to process every year to service customers, ensuring staff can focus on other areas of their job rather than just manually reading through invoices, packing lists and insurance documents.
“The average trade transaction requires 65 data fields to be extracted from 15 different documents, with 40 pages to be reviewed,” said Natalie Blyth, HSBC’s Global Head of GTRF.
“By digitising this process we will make transactions quicker and safer for both buyers and suppliers, leading our industry forwards, and we will reduce compliance risks through an enhanced ability to manage huge volumes of data.”
IBM and HSBC are hoping the technology will make it easier to process the unstructured and semi-structured data that businesses in the financial sector struggle to manage with manual processes. Automating it is the next stage in improving employee productivity and will allow trades to close faster.
“The problem is how to capture semi-structured documents with highly variant content through an analogue process, and no-one has the perfect answer,” said Roger Welch, Industry (Financial) Expert and Solution Architect for IBM Analytics ECM practice. “In our experience, no trade finance solution has come as far or done as much as this new solution.”
The technology is being used for English language transactions across Asia, Europe and both North and South America at the moment, but it's hoped that as the platform becomes more intelligent, it will be able to introduce other languages including French, Spanish and Chinese.
“We are continuously investing in technologies that will improve the way we work for the benefit of our customers and our people,” Blyth added. “HSBC wants to be the leading bank for innovation, and initiatives like this one are key to achieving our goal.”
Automation has been a hot topic in the paper-intensive world of trade finance in recent years. Banks have been investing heavily in AI solutions and developments, with fintech companies also developing solutions for the market.
Earlier this year, in one notable example, fintech company Traydstream was launched, with a solution that uses AI to digitise and automate trade documents, and automate regulatory compliance screening.
Other companies connected with trade finance are using AI to combat financial crime. In May, payments and compliance systems provider Pelican launched a trade-based money laundering (TBML) detection solution which uses AI technology.