SINGAPORE - A new government e-service that will help financial institutions address compliance challenges and better assess fraud risks in trade financing has been added to Singapore's digital national trade platform.
The Trade Finance Compliance (TFC) service was created by a joint partnership between Singapore Customs, the Monetary Authority of Singapore (MAS) and financial institutions as part of efforts against money laundering and terrorism financing.
The new service on the Networked Trade Platform (NTP) will help solve banks' inability to validate the underlying trade and the lack of reliable data to conduct price checks for non-commodity goods, Singapore Customs said.
Using data derived from permits issued by Singapore Customs, TFC allows financial institutions to reference such information to augment their checks for trade finance compliance.
To ensure proper data governance, traders can give consent on the NTP for their data to be shared directly with financial institutions of their choice.
Currently BNP Paribas, DBS Bank, ICBC, MUFG Bank, OCBC Bank and UOB have signed up for the TFC service.
Gillian Tan, executive director, Financial Markets Development Department, MAS, said: "By digitalising the trade finance compliance check process and directly referencing pricing and permit-related customs data on Singapore imports and exports, the TFC will increase the efficiency and accuracy of trade finance compliance checks for financial institutions in Singapore.
"As a result, these financial institutions will be able to better assess fraud and mitigate risks associated with trade-based money laundering."