ABS Counters Trade Finance Fraud with Newly Launched Trade Finance Registry

On 23 June 2023, the Association of Banks in Singapore (“ABS“) launched the Trade Finance Registry (“TFR“), an industry utility that aims to securely maintain a centralised record of trade finance transactions in Singapore with data provided by participant banks.

TFR intends to mitigate the risk of duplicate financing for the same underlying trade, thereby strengthening the trust and confidence among banks and traders, and Singapore’s role as a key trading hub.

Key Aims of TFR 

(a)       Removal of information asymmetry

TFR aims to remove information asymmetry faced by banks and help detect duplicate financing. Participating banks will register new trade financing transactions on TFR. The system will trigger notifications for the bank’s investigation in the event that registered new transactions are found to be duplicated.

(b)       Data Security

Only information on corporate customers will be provided to the TFR. Data on the TFR is hashed into an encrypted format. This not only protects personal data, but also avoids exposing the banks’ underlying data fields to other participating banks when matching potentially duplicate transactions.

(c)      Enhancing transparency

TFR aims to improve the transparency of trade financing transactions through API connections to the Singapore Trade Data Exchange (“SGTraDex“), a public digital platform that facilitates trusted and secure sharing of data between supply chain ecosystem partners. The exchange of data with SGTraDex is intended to enhance participant banks’ ability to validate the authenticity of the underlying transaction.

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