Major milestone for global trade finance & cross border payments achieved with four-corner BPO+ transaction involving BHP Billiton, Westpac, Cargill & ANZ
Valetta, Malta, 17 April 2015: essDOCS, the leading enabler of paperless trade, today announced the successful completion of the first ever CargoDocs Bank Payment Obligation Plus (BPO+) transaction for an iron ore shipment from Australia to China.
The trade involved global resources company BHP Billiton as the seller, Westpac as the recipient bank, ANZ as the obligor bank and agri major Cargill as the buyer.
It marks the first use of bank payment obligation where data flowed through all 4 corners with zero data re-entry, and the first use of BPO by Westpac – bringing the global number of banks live with BPO to 18.
CargoDocs BPO+ was developed by essDOCS as an out-of-the-box BPO solution for both corporates and banks, combining BPO with an online application plus data sourced from original eDocs such as electronic bills of lading (eB/Ls) and commercial invoices.
Two BPO baselines were created in CargoDocs BPO+ by the buyer, Cargill, and submitted to Obligor Bank, ANZ. ANZ subsequently transmitted the data to Westpac via SWIFT TSU, who in turn forwarded it to the seller BHP Billiton via CargoDocs.
Nadeem Ashraf, Trade Execution Lead, Cargill Singapore, said: “Our continued partnership with essDOCS, which started with eB/Ls, has now expanded to Bank Payment Obligations (BPO) and has added to our efforts to focus on the strategic goal of delivering added value via digitization of trade documents to all supply chain partners”.
Vivek Gupta, Global Head of Trade & Supply Chain Product, ANZ, said: “This transaction sets the tone for the success of BPO and the ongoing technological evolution of trade finance flows. Through this structure we have innovatively addressed the missing gaps one encounters while approaching BPO in isolation and have demonstrated that great value can be delivered through a collaborative approach between various supply chain partners.”
Final Data submission & eDocs in Escrow
Post-loading, BHP Billiton created an electronic bill of lading and commercial invoice in CargoDocs on April 7th. The final dataset was created automatically from data in the original eDocs and submitted to the recipient bank, Westpac. Simultaneously, with the final data submission, the original eDocs were placed into escrow within CargoDocs pending a BPO match.
Axel Boye-Moller, Head of Global Transactional Services, Asia, at Westpac said: “We are very pleased to work alongside key customers BHP Billiton and Cargill, as well as essDOCS and SWIFT, to deliver another ‘first’. This is another example of how we are delivering innovative solutions for our customers in Australasia and Asia, helping them achieve greater trade efficiency and speed.”
A TSU Match Report was generated on April 7 and the eB/L held in escrow was released to the buyer the very next day – thus leading to completion of the transaction in a single day, including the handling of a mismatch/discrepancy identified by TSU, which was resolved instantly.
Andre Casterman, Global Head Corporate and Supply Chain Markets, SWIFT & Chair of the Bank Payment Obligation Project at the International Chamber of Commerce, explains: “Digitising business-to-business information flows is now a priority for large corporates. SWIFT is proud to be working with essDOCS to maximise the benefits of our respective value propositions. The new BPO trade settlement instrument demonstrates again how banks are actively engaging in trade digitisation to bring new offerings to their customers.”
essDOCS launched CargoDocs BPO+ in February 2015 following extensive testing and trials with SWIFT’s TSU and major CargoDocs-enabled banks. Since BPO+ was developed for existing CargoDocs users, the solution maximizes the re-use of data from essDOCS customers’ eDocs, thus limiting human intervention.
CargoDocs BPO+ is now readily available to all essDOCS bank and corporate customers, with plans for upcoming BPO+ transactions underway in the chemicals, agri and metals & minerals markets. 6 banks are currently signed up to BPO+, with that figure expected to double in the second half of 2015.
Ashley Skaanild, Head of Trade Finance & Chemicals, essDOCS, said: “This is a major milestone for the use of electronic documents in trade finance. We set out to accelerate and automate BPO with a scalable, easy to use, secure platform, to enable corporates and their banks to adopt BPO as a trade finance instrument with minimum effort. By combining BPO with our eDocs platform, our customers have in this transaction demonstrated the true potential of BPO+.”
essDOCS is the world’s leading enabler of paperless trade, providing customer-led solutions that automate and accelerate trade operations & finance. essDOCS’ flagship solution – CargoDocs – delivers significant value to the entire supply chain: enabling users to streamline processes, reduce working capital needs and risk, while improving collaboration, compliance and visibility across organisations. Over 2, 300 companies, ranging from 10% of Fortune Global 500 to innovative SMEs, use essDOCS solutions across 65 countries in the energy, agriculture, chemicals and metals & minerals markets.