The opinions expressed here are those of the authors. They do not necessarily reflect the views or positions of UK Finance or its members.

Geopolitical tensions, economic uncertainties, and supply disruptions have made this network more vulnerable than ever.

A major weak spot? The financial backbone of the system. Production is often concentrated in smaller countries that provide access to cheap labour. However, these nations lack mature capital markets to keep small businesses solvent. To further aggravate matters, large Retailers often impose strict payment terms, sometimes stretching up to six months, leaving smaller manufacturers struggling. Without timely funding, these businesses can’t grow - or survive.

Trade Finance (TF) is designed to address this exact gap, but it doesn’t. Not in its current form. Traditional TF Platforms are slow, rigid, and lack transparency to address modern challenges. To meet new demands, we need tech-driven solutions—smarter, faster, and more adaptable.

Fintech's role in the digital transformation of finance

This shift is more than just automation—it’s a full-scale digital awakening. Cloud platforms and AI are cutting through bureaucratic complexity, transforming trade finance in two keyways: democratising information and accelerating transactions. Buyers can now connect with sellers worldwide, guided by transparent, crowd-sourced credibility. At the same time, digital platforms are challenging the status quo by making money move faster and at lower costs.

For businesses in developing markets, digital solutions are a game-changer. Fintech companies are leading this charge. leveraging AI, blockchain, and open banking APIs, they process vast amounts of data in real-time, fostering an inclusive financial ecosystem.

The old system relied on paperwork and patience. The new system prioritises speed, accessibility, and the idea that every business, regardless of location, deserves a fair shot at global trade.

Smoothening the financial pathway

Digital platforms are transforming complex financial processes into an integrated experience, giving SMEs seamless access to growth-capital. Models like buy-now-pay-later empower them to trade internationally. Fintechs enable small businesses to apply for financing, track applications, and access capital instantly. On the supply side, they introduce non-traditional, small-ticket lenders to the low-risk trade finance market.

Trade finance serves a diverse customer base, from corporate importers to SMEs run by multi-tasking entrepreneurs. Fintechs are pushing the sector toward hyper-personalisation, bridging gaps with tailored solutions. While fintechs excel in agility, banks must refine and scale the customer-experience. By integrating fintech solutions, banks can craft tailored experiences—whether for a Corporate Treasurer in London or an entrepreneur in Bangladesh. This evolution ensures trade finance becomes more accessible, intuitive, and inclusive.

At the heart of this transformation lies "API-fication." Secure, stable APIs enable fintechs to plug into banks and address long-standing global trade issues. As digital solutions streamline transactions, speed and transparency will become the norm. This shift isn’t about replacing legacy systems; it’s about evolving into a dynamic, digital-first ecosystem that responds to modern demands.

The digital future of trade finance

While geopolitical tensions and supply chain disruptions persist, the trajectory of trade finance remains promisingly digital. The International Chamber of Commerce forecasts a 3.8 per cent annual growth in trade finance, potentially reaching £91 billion by 2032. This growth will largely stem from digital trade platforms, such as those emerging from the Electronic Trade Documents Act (ETDA), which grants legal recognition to digital trade documents.

Ultimately, digital trade finance is about more than just speed. It could one day render traditional trade finance structures obsolete. In a hyper-connected world with minimal information asymmetry, today’s trade finance products may become unnecessary. Future trade will move as seamlessly as a text message, connecting buyers and sellers instantly, regardless of borders or bureaucracy. When that happens, we will witness the dawn of a truly global, accessible, and efficient marketplace.