HSBC Deploys Trade Finance API For Partner Banks

HSBC is continuing its open banking strategy with the deployment of a new application programming interface (API) designed to promote bank collaboration to facilitate trade finance.

Reports in Global Trade Review on Thursday (Sept. 26) said HSBC launch launched the new banking guarantee API, which enables HSBC partner banks to issue local guarantees in markets in which they don’t operate. The API aims to enhance visibility and management of those guarantees from within their own banking platform, HSBC said, adding that even guarantees issued by HSBC can be managed from within another bank’s own portals.

As reports explained, the bank guarantee ensures that a B2B supplier is paid on an invoice even if their customer does not pay. The API will allow HSBC partner banks to have HSBC reissue their guarantees if those partner banks don’t operate in the market in which a supplier does.

“For example, an Italian-based customer who needs to do a project in the Middle East has to issue local guarantees in the Middle East, but it can’t open accounts with another bank in the region for that purpose, as it is extremely costly and cumbersome,” explained HSBC’s Surath Sengupta, global head of financial institutions, portfolio management and distribution, global trade and receivables finance.

Sengupta spoke with the publication during Sibos earlier this week, adding that the API means “HSBC can issue the guarantee which they [the customer] can see. But they still have the relationship with their local bank, which also has a tie-up with HSBC. So they don’t have to navigate different banks for every project.”

Reports said HSBC’s API has already enabled partner banks ING Bank and Standard Bank to complete guarantee issuance.

In March, HSBC announced the rollout of a range of APIs for developers in compliance with the European Union’s PSD2 regulations. The APIs enable developers to create their own solutions that can integrate with data held by HSBC, including payment initiation, account data and funds confirmation.