Looking Beyond Machine Learning To Balance Out Trade Finance Supply And Demand 7wData

The International Chamber of Commerce Banking Commission recently released a report that found an imbalance between supply and demand of trade finance services. Its Global Survey on Trade Finance, which surveyed financial institutions across 98 countries, found that 61 percent of banks say they face greater demand for trade finance than they can supply. More than two-thirds told researchers that compliance and regulatory requirements are holding them back from providing more trade finance in the short term, while cost control pressures were identified as the top challenge for FIs' (financial institutions) trade finance operations. Indeed, banks must tread carefully in the world of trade finance, and with such little room for error and financial losses, risk management is critical. In many ways, collaboration with FinTechs has become a key part of risk mitigation for banks, with researchers finding that only 1.4 percent of bank respondents said they consider FinTech's competitive offerings as posing a threat to traditional banks' position as trade finance providers.