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Evolution of Document Examination in Letters of Credit (1970s–2020s)… and the rise of TradeSpeed

For decades, the Letter of Credit (“LC”) as we know it today has served as the bedrock of international trade, providing a mechanism of trust between parties who may never meet. However, document examination - verifying that the transport, insurance and commercial documents match the terms and conditions of the LC - has historically been a hugely manual, labour intensive process relying heavily on individuals that have gained extensive experience over many years and often supplemented by attaining a recognised certification such as the CDCS.


Readers of this article will resonate with one or more of the decades mentioned, maybe all five for a seasoned few!


1. The 1970s: The Fully Manual Era


Despite the arrival of Swift, in 1973, with the aim of ‘electronifying’ the transmission of LCs, document examination in the 1970s was a craft; slow, paper‑heavy, and dependent on the personal expertise of seasoned trade staff. LCs, and their amendments, were predominantly issued on paper and sent to advising banks by airmail or registered email. By the end of the 1970s a handful of banks were starting the transition to ‘MT700’ issuance, but this was slow due to lack of development by their correspondent banks. Telex was the sole means for many banks for any urgent LC issuance.


Automated back office systems were largely confined to the drawing board or remained a distant thought of a forward thinking individual.


Key characteristics


  • 100% manual examination of documents (invoices, bills of lading, insurance, other certificates etc.).

  • Reliance on individual judgment, institutional memory, and experience.

  • High discrepancy rates due to inconsistent interpretations.

  • Registered mail with some courier‑based presentations, long transit times, and limited visibility.

  • UCP 222 and UCP 290 shaped practice but left wide room for interpretation.


Operational reality

Banks often had “legendary” or “specialist” document examiners whose personal style defined document examination outcomes. Consistency across branches, or even across desks, was rare.


2. The 1980s: Growing Volume, Same Manual Tools


Global trade expanded rapidly, but document examination processes barely changed.


What changed


  • More complex LCs with additional conditions.

  • Use of the MT700 was gradually increasing for LC issuance 

  • Use of courier services was increasing for document sending.

  • Higher document volumes, but still no digital support.

  • UCP 400 (1983) attempted to provide clarity to the rules but did not fundamentally change document examination practice.

  • LC department recruitment predominantly consisted of individuals with shipping and/or logistics experience i.e., no need to train them on what is a bill of lading or the data requirements and structures of most documents.


Pain points


  • Human fatigue (large volumes leading to the implementation of daily targets for the number of presentations to be examined per day, increasing the pressure on document examiners).

  • Errors were often made in all aspects of the processing.

  • Slow turnaround times.

  • Disputes (bank-to-bank and bank-to-beneficiary) became a normal part of LC operations.

  • Limited number of banks with automated back-office systems.


3. The 1990s: Standardization Begins


This decade marked the first real shift toward consistency and predictability.


Major milestones


  • UCP 500 (1993): A landmark update that clarified many ambiguous areas, but imposed a seven banking day deadline for banks to determine whether to take up the documents or refuse them (previous UCPs had simply referred to a ‘reasonable time’)..

  • Early imaging systems: Banks began scanning documents for storage, not examination.

  • Email and fax: Faster communication, but documents still paper-based and subject to manual examination.

  • Checklists: Banks created internal checklists to reduce examiner‑to‑examiner variation.

  • Development of more complex transactions: For example, commodity shipments with non-standard documents often required 2-3 examinations to be completed due to the values involved and the complex nature of some presentations.


Impact


  • Document examination became more structured.

  • Training improved.

  • But, the process was still fundamentally manual.

  • Some banks looked to outsource their document examination process in order to meet the UCP 500 deadline and growing client expectations (managing fluctuating volumes was a major problem for some banks)..


4. The 2000s: Digitization and Workflow Automation


The 2000s introduced the first meaningful digital transformation. LC rules (UCP and eUCP) as well as the ISBP revised / updated regularly.


Key developments


  • Document imaging (basic, often unreliable).

  • Workflow systems: Routing, queues, four‑eyes checks, audit trails.

  • ISBP 645 (2002): The first International Standard Banking Practice—hugely influential.

  • eUCP v1.0 (2002): The first step toward electronic presentations.

  • UCP 600 (2007): Streamlined rules, clearer definitions, and a more modern framework.

  • ISBP 681 (2007): To align with the UCP 600 text.

  • eUCP v1.1 (2007): To align with the UCP 600 text.


What this meant for document examiners


  • More consistency.

  • Better auditability.

  • Foundation for faster processing.

  • But still: manual examination, and accuracy depended on skill and experience.


5. The 2010s–2020s: Further Enhancement of Rules (eUCP) for use with Electronic Records and the AI Revolution


The events surrounding the COVID-19 epidemic, and the consequential Global lockdown, brought to the fore the need for trade finance to move from discussion to action in the movement from paper to digital. The ICC issued its “Guidance paper on the impact of COVID-19 on trade transactions issued subject to ICC rules” as a means of highlighting the issues that arise when the handling of paper documents is not possible or severely restricted - from the movement of the presentations to the examination thereof when access to bank buildings was not possible or feasible.


Key Developments


  • ISBP 745 (2013): To update practices that had developed or changed since ISBP 681 was implemented in 2007.

  • eUCP v2.0 (2019): To ensure continuing compatibility with digital data and evolving market practice

  • eUCP v2.1 (2023): Alignment with the UNCITRAL Model Law on Electronic Transferable Records (MLETR)

  • ISBP 821 (2023): To incorporate ICC opinions given in respect of document examination issues since ISBP 745 was implemented 2013.


This is where TradeSpeed enters the story.


TradeSpeed does not just digitize the process, it changes the nature of document examination.


What TradeSpeed brings to the table


Document classification

Automatically identify document types (invoice, transport, certificates of origin, insurance, etc.).


Data extraction

Pulls data from document fields with high accuracy (over 95% out of the box), even from poor quality scans.


Rule mapping

Compares extracted data against:

  • LC terms and conditions

  • UCP 600

  • ISBP 821

  • Bank policy(ies)

  • Sanctions and compliance regulations


Cross‑document consistency

Checks alignment between documents (dates, quantities, descriptions, vessel names, etc.).


Empowering improved Human decision-making

TradeSpeed handles the routine; bank document examiners handle the exceptions.


TradeSpeed: The Next Step in Automated Examination


TradeSpeed represents the modern generation of AI‑powered LC document examination tools, built specifically for trade finance workflows.


What TradeSpeed enables


  • Automated first‑pass examination of full document sets.

  • Intelligent extraction by using individual document parsers to achieve over 95% accuracy (out of the box) in the extraction of data from trade documents across 50+ languages.

  • AI‑driven discrepancy detection with clear UCP and ISBP supported explanations and discrepancy wording.

  • Consistency of document examination across teams, branches, and countries ensures every presentation is examined to the same standard, every time.

  • Massive reduction in turnaround times with 70% or more experienced.

  • Lower operational risk through standardized interpretation of UCP and ISBP.

  • Integrated compliance checks for sanction breaches, dual-use goods detection, vessel tracking, TBML violations and red flags.

  • Scalable operations without linear increases in staffing.


Conclusion: Why this matters


The “check and stamp” culture of the 20th century has reached its limit. TradeSpeed represents the final bridge between the paper-heavy past and a fully digitised future. By automating the necessary, the precise and, often, the trivial details associated with document examination, banks can finally offer the speed and security that modern global supply chains demand.


TradeSpeed allows banks to automate at least 80% of the ‘labour intensive’ work’ in determining compliance with the terms and conditions of each LC, allowing document examiners to focus on the high-risk, high-value trade decisions. In effect, financial institutions are not necessarily replacing their experts, they are giving them increased powers - allowing them to oversee often massive volumes of trade with a level of precision and speed that has been physically impossible in years gone by.


More client interaction, client training and business development becomes the new opportunity.


Summary Timeline




Cont me for more information or a demonstration of TradeSpeed. It could well be the most important and beneficial email you will send in 2026!


In the meantime, I wish you a Very Happy, Peaceful, Healthy and Prosperous 2026!



Gary Collyer

Head of product at TradeSpeed

Gary started his banking career in 1973 with Midland Bank PLC in London and spent more than two decades in trade finance with various leading global trade banks before setting up his own business.. Gary was the chairman of the drafting groups for the UCP 600 and the ISBP 745, and more recently co-chair for eUCP, eURC and ISBP 821.


Discover how TradeSpeed can help your institution → https://www.complidata.io/tradespeed



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