The new offering is designed to “transform and standardize” how trade finance documentation is processed, traced and reviewed at the bank, HSBC announced Monday (Sept. 28).
“Documentary trade at HSBC involves a highly complex, document-intensive operation involving the processing of over a million documentary presentations each year, including documentary credits and collections,” the bank said in a news release.
“Each presentation can extend into hundreds of pages, with a large range of structured and unstructured data points requiring extraction for further review.”
Adding to this complexity is the fact that documentary credit checks often include additional conditions unique to each transaction and its commercial contract. This means documents and checking requirements can vary greatly from transaction to transaction. Transactions might take hours to process, meaning high operational demands, especially during peak activity periods, the bank said.
We’d love to be your preferred source for news.
Please add us to your preferred sources list so our news, data and interviews show up in your feed. Thanks!
Smart Checking has been developed to help address these concerns with a mix of AI technologies and trade expertise for more streamlined checking, the release said.
AI extracts and classifies information from documents, “with advanced AI models turning complex and inconsistent documentation into structured data, helping information enter the process in an organized and searchable format,” HSBC added.
For clients, faster document processing can help accelerate time to payment, providing greater certainty and enabling businesses to access liquidity and working capital sooner.
“Smart Checking is an ideal combination of AI and human expertise. AI handles the scale and complexity of documentary trade, while human judgement is essential to understanding exceptions and making the decisions that matter,” said Thomas Elliott, HSBC’s chief operating officer, global trade solutions.
“By co-creating the solution with our trade experts, we are building technology that boosts efficiency, practicality and innovation.”
Smart Checking is now being used in the United Kingdom, Hong Kong, and the United Arab Emirates, with eventual plans for a global rollout, the release said.
PYMNTS examined the role AI can play in trade finance in a report last month, noting that the working capital cycle features several gaps between when economic activity happens and “when finance learns enough about that activity to act.”
“Even modest reductions in that latency could matter at scale,” the report said. “Accelerating invoice creation can lower days sales outstanding. Faster confirmation can allow buyers to approve invoices earlier and potentially capture discounts. More precise visibility into when commercial obligations are fulfilled can improve cash forecasting.”
Add as Preferred Source
