Pan-African bank Absa Corporate and Investment Bank (CIB) has become the first African bank to join the digital trade finance network, Contour.
With this move, Absa CIB is hoping to position itself at the forefront of digital developments by being a part of the Contour digital trade finance network. Many of Africa’s trade transactions are manual and paper-based, slowing down trade growth and creating another layer of complexity and costs.
Following the move, Absa CIB’s clients will now gain access to Contour’s digital Letter of Credit (LC), which reduces the process of presenting documents from an average of 5 to 10 days to under 24 hours.
Digital developments are a big part of addressing challenges and creating access to new markets. In Africa, digitisation is critical to the success of the African Continental Free Trade Area (AfCFTA), a flagship project that aims to boost intra-Africa trade by 52.3 per cent and expand the size of the continent’s economy to US$29 trillion by 2050.
With a presence in 15 countries from Botswana to Zambia, the Johannesburg-based diversified financial services group is banking on innovation to drive sustainable growth. Digital developments can reduce barriers to accessing trade finance and collectively, fintechs and financial institutions can work together to help trade and trade finance grow in a sustainable manner.
A “growing momentum across Africa to accelerate digitisation”
Carl Wegner, CEO at Contour, discussed the significance of the move: “In today’s fast-paced and interconnected world, digital developments are crucial in unlocking new opportunities for trade growth and access to new markets. By joining Contour’s digital trade finance network, Absa CIB and its clients are contributing to the growing momentum across Africa to accelerate digitisation.”
Contour is looking to build the global standard for trade by bringing together the world’s banks, corporates and ecosystem partners, onto a common, digital, and trusted network.
The digital trade finance network also uses decentralised technology to offer seamless integration with market-leading digital systems and other digital networks, enabling the instant flow of trusted data across the world’s trade routes and existing fragmented ecosystems.
Michelle Knowles, head of trade and working capital product at Absa Corporate and Investment Bank, also commented: “Absa continues to be at the forefront of digital innovation in Trade as a mechanism of increasing the availability of Trade Finance and reducing the costs associated with these critical solutions. We are excited to join the Contour network, which will further strengthen our digital capabilities and support our clients with leading-edge solutions.”