The Bank for International Settlements (BIS) has initiated Project Aperta aiming to explore reducing frictions and costs in global finance by enabling cross-border data portability. According to the announcement, the project’s goal is to link the domestic Open Finance systems of different countries, with the first focus on improving trade finance for SMEs.

Why was Aperta launched? Businesses involved in trade finance often face challenges when using financial products like letters of credit, trade credit insurance, and supply chain financing. These processes are usually slow, inefficient, and costly due to excessive paperwork and limited digital data sharing. Digitising trade finance could foster sustainable economic growth, support financial stability, and make the global financial system more resilient.

Currently, around 70 jurisdictions regulate Open Finance using different approaches, with Open Banking being a part of this. However, these systems often use different standards, making it difficult for data to flow smoothly across borders. But technologies based on proven application programming interfaces (APIs) have the potential to significantly enhance cross-border data portability via these existing ecosystems, as the true value lies in facilitating international data flows.

While some countries have begun addressing cross-border data portability through bilateral agreements, this could lead to fragmented standards and systems, making them less scalable and more complex. Ensuring interoperability and avoiding fragmentation is key, and this is where Project Aperta aims to make a difference. How Aperta works Aperta will provide an innovative mechanism for global interoperability, offering features, functionalities, use cases, security protocols, operating procedures and trust frameworks for Open Finance across jurisdictions.

Currently, the project involves the UAE the UK, Brazil, and Hong Kong. The participants have varying approaches to Open Finance – ranging from regulatory-led to hybrid to market-led. Through Project Aperta, authorised third-party providers, such as banks or fintechs, in one country will be able to connect with providers in other countries.

This will enable the sharing of critical financial information, such as payment and account data, letters of credit, or electronic shipping documents. The prototype will facilitate the cross-border transfer of: A consumer’s account and business data to quickly open a bank account abroad  Trade finance data, such as shipping information, to lower the cost and speed up international trade Project Aperta is a collaboration between the BIS Innovation Hub Hong Kong Centre, the Central Bank of the United Arab Emirates, the Banco Central do Brasil, the UK Financial Conduct Authority, the Hong Kong Monetary Authority, the Global Legal Entity Identifier Foundation, the International Chamber of Commerce Digital Standards Initiative, and the Hong Kong University Standard Chartered Foundation FinTech Academy. Source: Link .