Reimagining Corporate Lending: Key Trends Shaping the Future of Trade Finance

Monetizing SBLCs, BGs, and Other Financial Instruments Learn More about Capital Raising Equity Contact US

Corporate Lending and Trade Finance in Transition: Key Takeaways from Finastra’s Europe Corporate Banking Day

April 2025

By Ganesh Venkataraman

Corporate lending and trade finance are witnessing a paradigm shift—this much is clear. With digitisation, artificial intelligence, and an ever-evolving market landscape at play, the sector today is one of the most dynamic areas in finance. Opportunities abound, but so do the challenges, particularly amid complex geopolitical currents.

To explore how institutions can navigate these shifts and seize emerging opportunities, Finastra, a global leader in financial software solutions, recently hosted its annual Europe Corporate Banking Day in London. Supported by sponsors Microsoft and Tech Mahindra, the event brought together senior executives from across banking, technology, and sustainability sectors to share insights on the current and future state of corporate finance.

Here are five major insights from the discussions:

1. A Shifting Market Landscape

   The corporate lending space is experiencing growing influence from institutional investors and private credit, who are increasingly participating in direct lending. Borrowers, on their part, are actively seeking tailored financing models. However, challenges remain—particularly around transparency, operational inefficiencies, regulatory constraints, and the need for better integration across systems.

   In addition, global geopolitical and economic shifts are reshaping traditional trade routes. As a result, institutions must adapt swiftly—pivoting from payables-based finance to receivables-based finance, and leveraging emerging trade corridors to stay competitive.

2. Digitisation: A Necessity, Not a Choice

   Corporate clients today demand services that are digital, seamless, and personalised—spanning both local and global scopes. However, digitisation continues to be a double-edged sword. According to a poll conducted at the event, 44% of institutions cited digitisation as both the biggest challenge and greatest opportunity.

   Much of the industry still operates on paper-based processes, leading to bottlenecks and delays. To truly transform, banks must invest in end-to-end digital journeys, faster loan approvals, and straight-through processing. Technologies like cloud computing, APIs, digital ecosystems, and AI will be instrumental in enabling this transformation.

3. Knowledge Drain and Talent Retention

   With senior professionals approaching retirement and a new generation entering the workforce, banks face a critical need to preserve institutional knowledge. This requires structured knowledge management and the digital transformation of administrative roles to attract and retain younger, tech-savvy talent.

   In fact, nearly 25% of respondents highlighted talent attraction and retention as one of their top concerns—suggesting that upskilling, automation, and a shift to high-value roles are more urgent than ever.

4. AI is Revolutionising Trade and Lending

   Artificial Intelligence is no longer a futuristic concept—it’s a present-day force of transformation. When deployed effectively, AI enhances decision-making, automates repetitive tasks, and increases both efficiency and speed across operations.

   From issuing digital trade agreements and letters of credit to supporting sustainability compliance, AI’s role is expanding rapidly. In the near future, we could see autonomous supply chains, AI-driven contract settlements, and fully digitised trade documentation, making the finance ecosystem faster and smarter.

5. Tokenisation and the Future of Trade Finance

   Tokenisation—a concept long in the spotlight—is now moving into practical experimentation. Financial institutions are exploring its potential through smart contracts, stablecoins, and risk tokens to enhance settlement speed, capital access, and risk management.

   While the possibilities are immense, the lack of industry-wide standards poses a challenge. Some experts argue that setting standards too early could stifle innovation, suggesting instead that frameworks should evolve organically as market connectivity improves.

Final Word

Speakers from Finastra’s Lending business, including Andrew Bateman, Lekshmi Nair, Robert Downs, Anastasia McAlpine, and others, joined thought leaders from Microsoft, Tech Mahindra, ING, Loan Market Association, Crédit Agricole CIB, and more. Their collective insights highlighted one core message: the transformation of corporate banking is well underway, and institutions must embrace agility, technology, and talent development to lead in this new era.

As India continues to play a growing role in the global financial ecosystem, these conversations are highly relevant for Indian banks and corporates alike. With a strategic focus on innovation, digitisation, and global connectivity, the path forward for corporate finance in India—and beyond—looks both promising and powerful.