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A riskier landscape demands a trusted system

There are two types of companies: those who know they’ve been hacked, and those who don’t. Firms are scrambling to mitigate risk.

There are two types of companies: Those who know they’ve been hacked, and those who don’t. Firms are scrambling to mitigate risk.

Komgo SA is a software development and IT services company incorporated in Geneva since 2018. Founded by leading Swiss and international companies in the trade and commodity finance industry to drive digitalisation of the sector, Geneva was a natural choice in its capacity as a world-leading commodity hub, its access to highly skilled human resources, and its respected role in driving best practices for the industry.

Three years later, there is no doubt that Komgo will transform the trade finance industry over the next decade. Indeed, the environment post-COVID-19 is mainly about mitigating fraud risk, as fraud is more prevalent in times of financial stress. Regulators are pressuring banks to add fraud mitigation tools to all their products. This is even more true in the commodity space, where transactions are generally not yet conducted via digital channels and trusted counterparties; both banks and trading houses need an easy and simple way to enhance their trade execution.

Komgo powers a secure network of verified actors generating instantaneous trust between parties, and offers a smart solution, Trakk, to increase the security of trade documents exchanged between multiple parties via email (invoices, contracts, BLs, etc.). Trakk allows users to register the proof of any document to create an immutable, digital version, whose genuineness and authenticity can be easily verified by anyone, thus guarding against fraud and falsification. Banks, traders and inspection companies can track the usage of the documents and add the activity they have performed with it (financed for a bank, for example). This creates a digital audit trail against a document that will strongly mitigate the risk of it being reused for fraudulent purposes.

Digitalisation is the first step toward efficient fraud management as it strengthens organisational processes, decreases dependency on emails where information is siloed, and limits manual checks by enabling automation. It frees time for a company's teams to focus on what matters. Komgo has seen a surge in demand in the past months, especially for Trakk, as it can be deployed quickly, requires very little change management, and brings new visibility to the status of trade documents. Leading corporates are now registering all of their invoices on Trakk, which has brought significant comfort to their lenders and trading partners. 

COVID-19 has also compelled many teams to shift to remote work, and most managers acknowledge that we might never return to business as usual, which has increased demand for cloud-based software applications and remote login infrastructure, a key added-value provided by Komgo.

The pandemic is also disrupting supply chains. Reliance on the movement and processing of physical paper has proven too slow, and has delayed the time between order and cash collection. Companies have to hold more inventory, as delays in shipments of one component can derail the entire manufacturing process; the industry has moved from “just-in-time” to “just-in-case”. This is more expensive and requires more financing, and emphasises the need to go digital to execute safer, more efficient transactions. Komgo’s network is underpinned by permissioned, authenticated messaging removing the need for signature verification and call-backs, while structured data from Komgo messages can be easily mapped and integrated with any internal system, generating huge efficiency gains and reducing manual errors.

Digitalisation is no longer a discussion topic; it is an absolute “must have”, which will play a major role in the future of the trade finance industry. No organisation can afford to be left behind, and those that move too slowly will lose a competitive edge to others who are already working together to build a trusted and more secure financing environment.

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Souleïma Baddi

Komgo Chief Executive Officer

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