Staney Pullolickel, Trade Advisory Board, Trade Technologies

Role of corporate treasury in SBLCs and guarantees

Corporate Treasury teams—whether in large multinationals or smaller organisations—are at the centre of how Standby Letters of Credit (SBLCs), guarantees, sureties and corporate guarantees are issued, received, tracked and ultimately leveraged to support business growth while managing risk. Yet, in reality, many treasuries are still forced to manage high-value, complex portfolios through spreadsheets, emails and disconnected bank portals, creating an environment that is fragmented and operationally fragile.

These instruments are not only something an organisation “gives” or “issues” to customers, landlords ,project owners or government authorities; they are also powerful risk-mitigation tools you “receive” as a beneficiary from suppliers, contractors and counterparties. A mature treasury looks at both sides as one integrated portfolio of risk-related rights and obligations rather than treating inbound instruments as a mere legal footnote handled somewhere in procurement or operations. This is no longer a back office paperwork job.

Many large corporates have taken the time and effort to create bank agnostic platforms to manage this, however most corporates are not at this stage, especially for the inbound portfolio.

Typical challenges in managing these Risk Mitigation Instruments

Treasuries face a set of recurring pain points in dealing with these instruments, regardless of size. The symptoms are similar; the root causes differ between large and small organisations.

Lack of holistic visibility and dispersed data

• Information sits on multiple bank portals, spread sheets, emails etc. and also in different pockets across an organisation. If a Treasurer needs information on all such instruments, by the time the information is gathered – its dated. 

Lack of controls and processes 

• A Sales lead may accept to issue an instrument which is detrimental to the corporate, just in order to close the sale. Large corporates, face an issue to maintain audit trail  and compliance and smaller organisations create person dependency related risks.

Expiry, validity and amendment risk

• Lack of tracking dates and also country level legalities, leads to instruments being valid far after the project is completed. On the inbound side, missed expiry and ambiguous amendment process means losing protection, the very essence why there was a need for such an instrument in the first place.

Documentation and wording complexity

• Wording on these instruments can be hugely challenging: local conventions, language challenges and different legal standards ((URDG, ISP, local law). Without proper expertise and legal framework. Corporates are accepting instruments which are not worth the paper they are printed on.

Operational stress and manual work

• Checking language, reconciliation of utilisation, monitoring expiry etc. relies hugely on manual effort, email workflows and eventually the ever green spreadsheet. Such processing creates huge operational, commercial and enterprise risk. This is overlooked at most corporations.

Portfolio insight and pricing optimisation

• Most treasuries cannot analyse their portfolio by bank, fees paid, jurisdictional usage etc. Hence a relationship level discussion is not easy to have. At what stage to replace an instrument via alternatives risk- mitigation tools hence becomes an impossible task.

Fraud and compliance risks

• Fraudulent calls, forged guarantees or unclear beneficiary rights create legal and reputational risk, especially when documentation and validation is done manually.

Large v/s small organisations: different realities 

The instruments are the same, however the context of how treasury teams manage them is different between large and small corporates. 

For large corporates key unique challenges are

• High Volumes and complexity 
• Large bank network and counterparties
• Audit trail within the corporate- “Who accepted this language?, why?”

And for small corporates 

• Capacity and capability to manage these instruments 
• Pragmatic processes: For e.g. Running FX operations and trade operations via the same desk

How a digital platform improves transparency and portfolio management

A dedicated digital platform gives treasury what is often missing today: a single, reliable view of all instruments, supported by automated workflows and fueled by expertise. Tangible benefits exists for both small and large corporates. 

Benefits include

• Centralised and real time view
• Monitoring the life cycle and events of the instrument
• Standardised process and templates
• Better pricing discovery and bank relationship management 
• Stronger risk and controls 

For large corporates: the platform primarily enhances control, efficiency and insight across a complex global portfolio, enabling treasury to operate as a true risk and value partner to the business.

For small corporates: the platform is about simplification and confidence: fewer manual spreadsheets, clearer responsibilities, and access to best-practice structures without needing a large in-house trade team.

When it comes to selecting a partner for such a digital platform, a combination of different criteria should be considered such as:

• Does the partner offer technology only or can the partner provide some additional added value by supporting with knowledge and expertise?
• Is the platform able to deal with different types of instruments and transactions?
• What kind of interfaces does the platform support?
• To how many partners does the platform provider already have a connectivity to?

What makes Trade Technologies' trade tech offering unique?

Trade Technologies' value proposition sits at the intersection of deep trade finance expertise in terms of experts who have been managing these instruments all their life and a modern, purpose-built technology for all risk mitigation instruments. This combination addresses not only the data and workflow gaps, but also the practical questions treasury teams face every day on wording, structure and negotiation.

• Purpose-built SBLC and guarantee management system

Trade Technologies’ solution is designed specifically for the end-to-end management of inbound and outbound SBLCs and guarantees, rather than as a generic add-on to broader banking or ERP systems.

This focus allows the platform and the team to support the full lifecycle: onboarding existing portfolios, standardising templates, tracking utilisation and expiries, and producing management and high level management reporting.

• Combination of trade experts and tech specialists

Trade Technologies brings seasoned trade finance professionals who understand the nuances of SBLC and guarantee structures, documentation standards and market practices across jurisdictions.

These experts work with technology teams to embed “intelligent defaults” into the platform – practical workflows, rule sets and checks that reflect how treasury, legal and commercial teams practically operate.

• Tech-Enabled Trade services, not just software

This is particularly valuable for organisations that want to move quickly from spreadsheets to a controlled environment without dedicating large internal resources to migration and data quality. In this context, the service stands for a fully managed service where the corporate does not need to get actively engaged in.

• Flexible deployment for both large and smaller treasuries

Large organisations can integrate Trade Technologies’’ TradeSharp platform with existing treasury, ERP and bank connectivity layers, while smaller firms can start with a lighter footprint that still gives them professional-grade control.

• Data-driven insight and continuous improvement

With consolidated data and workflow analytics, Trade Technologies can help treasuries identify trends such as recurring wording issues, risks, process lapses or pricing concerns. This can be done at a pre agreed interval as needed by the corporate. 

To summarise 

In a world where guarantees, SBLCs and sureties support billions in commercial value, the corporate treasury is no longer a passive processor—it is the guardian of risk, reputation and reliability. The organisations that win are those that treat these instruments not as scattered documents, but as a strategic portfolio that deserves real visibility, real controls and real expertise. The message is simple: a modern treasury cannot afford manual blind spots. By embracing digital platforms and expert-led processes, treasuries—large and small—move from firefighting to foresight, from paperwork to partnership, and from operational burden to strategic advantage. The future belongs to treasuries that see guarantees not as admin, but as instruments of trust, protection and commercial power.