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Technical Committee 68 of the International Organisation for Standardisation (ISO) for financial services standardisation created a common standard,  ISO 20022, around two decades ago. This development was transformational. It was adopted as the soul and core of the Single Euro Payments Area (SEPA) payments market infrastructure clearing, which kicked off in 2008. Within a few years, the interoperability between the payments of over 15 countries using EUR was created.

Now there are over 70 similar ISO 20022-based payment market infrastructures in the world. Finally, in the international payments context, the SWIFT banking system will move to ISO 20022 in November 2025.  So, in payments or cash management, all market stakeholders know how and with which standard to exchange data between any party in the payments value chain. 

This is exactly what we need to achieve in the trade and trade finance domain as well.  Moving from proprietary Swift message type (MT) standards to openly and freely accessible data standards and detailed documentation of business processes across trade finance lifecycles is essential to ensure foundational interoperability. In short, stakeholders will be able to speak the same data language.  

Five or ten years ago, talking the same data language was a distant dream, but suddenly now, by the work of various trade domain stakeholder groups, the industry is heading well into the same direction. It will be a long and winding road, but the endpoint is in sight.

Straightening the winding road

Everything starts with the business case. It might have been partly the COVID-19 Pandemic which showed that old, paper-based, and honestly tedious manual processes have to be improved. Additionally, the open standards-based approach in the payments domain has likely spurred digitalisation within the trade sector. 

In the context of international trade and trade finance, key components of digitalisation include necessary legal reforms, digital identities with robust digital trust, and access to open standards and development documentation. 

The Model Law on Electronic Transferable Records (MLETR) addresses the need for a legal framework that permits digital processing alongside traditional paper-based methods. Many technical, functional, and even regulatory solutions are developed for digital trust enablement. Focusing on the last pillar – for all documentation to be openly available at the various community channels – is essential for full digitalisation. Meanwhile, the Standardised Trust community has focused on transparency, ensuring that all documentation of the team’s contributions and outcomes is accessible through various community channels.

Solving these prerequisites makers on the trade digitalisation base work try to offer key building blocks for open and harmonised data exchange between various trade and trade finance parties. 

And finally, all aims to secure the payments in global trade mitigating its risks with digital approach. More complex and challenging geopolitical situations and existential challenges (climate change and various other sustainability risks) don’t allow for slow and paper-based processes on the goods delivery and their payments anymore. 

Ensuring an inclusive transition

A majority of national economic welfare comes from small- and medium-sized enterprises (SMEs). This is challenging in the context of global trade, as this group of operators are also the ones unable to invest in the latest digital solutions – unless they are offered in an easy and reachable manner.  

The same is true for financing. Letters of credit and bank guarantees are neither the easiest nor the cheapest instruments. By digitalisation and better risk management, there should emerge easier ways to manage trade risks and lower costs and complexity through higher levels of automation. Facilitating accessibility to various platforms where both actual instrument use and related risk mitigations can be covered as a holistic solution, would also improve the standing of SMEs. 

To reiterate: there is no way to safeguard solutions with legacy or proprietary approaches when digital data and information exchange with a common semantic model are needed.

For Standardised Trust’s part, offering a semantic model for letters of credit and bank guarantee data exchange with an understandable and structured data model explained through clear semantic definitions, aids in SME inclusion.   

Standardised Trust doesn’t develop its own application solutions or platforms, but each solution provider may use its model when planning and designing the data exchange with other relevant trade and trade finance platforms. Digital security and trust are important prerequisites for reliable data exchange and can best be provided and implemented by area specialists. 

To this end, Standardised Trust has created GitHub environments to share technical documentation, and it works as one channel to promote the Standardised Trust artefacts. It includes JavaScript Online Notation (JSON) schemes for the letter of credit and bank guarantee technical data structure for anyone interested in exploring and using it for their own application development. JSON schemes are a good way of designing application programming interface (API) integration interfaces to any existing or new platforms. 

The current trade ecosystem development effort is very promising. The rationale of the trade digitalisation business case has been finally approved, which has likewise improved the willingness to participate in the next steps.  

The Standardised Trust team’s contribution of open, easily accessible, and usable tools and documents may help any party interested in offering digital information exchange capability. Having a semantically common language makes digital communication happen smoothly.