Finastra has launched StandbyX, a cloud-enabled solution for US banks to digitise standby letter of credit processing.
The solution is delivered under a software-as-a-service (SaaS) model and focuses solely on standby letters of credit (SBLCs). It is aimed at banks that want to automate SBLC workflows and strengthen risk management without implementing a full trade finance platform.
A manual process for many regional banks
In the US, SBLCs continue to be used across both trade and non-trade transactions. Larger institutions tend to handle these instruments within broader trade finance operations, often using platforms such as the company’s own Trade Innovation. However, many regional and mid-sized banks still process SBLCs manually or semi-manually. Finastra links this approach to operational inefficiencies, higher risk, and limited scalability.
These banks face a specific combination of conditions. Their SBLC volumes may be relatively low, but the value of individual instruments is often significant, which makes effective risk management a priority. Finastra positions StandbyX as a way to address this without the cost and complexity of deploying a complete trade finance system.
Vinay Mendonca, Head of Trade and Supply Chain Finance and Corporate Channels at Finastra, noted that making trade finance technology more accessible allows a wider range of institutions to improve operational efficiency and strengthen controls.
Built on the Trade Innovation SBLC module
StandbyX draws on the SBLC module of Trade Innovation, which Finastra says is used by more than 150 banks globally. The SaaS deployment model targets banks with low to moderate transaction volumes, with the aim of shortening implementation timelines so institutions can see results sooner. The company states that the solution requires limited integration and testing effort, which it says results in a competitive total cost of ownership.
Trade Innovation itself is designed to help financial institutions automate trade finance workflows, manage risk, and improve operational efficiency. StandbyX makes one of its capabilities available as a standalone service, separate from the wider platform.
The launch forms part of Finastra’s ongoing investment in its trade solutions portfolio. Its goal is to deliver modular, cloud-enabled, and API-first solutions, and StandbyX follows this approach by offering functionality within a single product.
By extending digital trade functionality to banks that would not otherwise deploy a complete trade finance system, StandbyX expands the potential customer base for Finastra’s trade technology beyond larger institutions.
