The Sunday Draft

Origin: A cross-border trade finance exchange | ITFS Platform 

Context

India’s small and mid-sized exporters often face long payment cycles when selling to overseas buyers. To bridge this working capital gap, platforms like ITFS (International Trade Financing Services) were introduced—digital marketplaces that connect exporters with global financiers who can offer short-term loans against export invoices.

Unlike domestic platforms such as TReDS, where Indian buyers are mandated by the RBI to register and participate, ITFS operates globally. This means that overseas importers—and even Indian exporters—can’t be forced to complete upfront onboarding or compliance checks. As a result, the platform needed to show exporters financing options before asking for detailed KYC or importer involvement, while still ensuring trust and audit-readiness.

Adding to the complexity, the platform had to support two very different financing models:

• Spot Financing – Fast, one-time invoice funding where financiers compete via bidding to offer the best rate.
• Whole-Turnover Financing – A longer-term arrangement where a financier pre-approves a credit line and interest rate, and automatically gets access to all invoices from that exporter.

Supporting both models—competitive spot bids and exclusive whole-turnover deals—on the same platform meant rethinking deal discovery, user workflows, and compliance sequencing from the ground up.

Problem / Opportunity

We needed a platform capability that would:

• Enable exporters to signal financing needs before KYC onboarding
• Allow financiers to evaluate and respond with indicative limits and rate offer
• Allow exporters to select the best fit, triggering mutual onboarding only post-offer
• Maintain a bidding mechanism, even in whole-turnover setups, to prevent opaque deals
• Balance competitive fairness in spot financing (multiple financiers, one invoice) with exclusivity logic in whole-turnover deals (one financier, all invoices)
• Ensure regulatory readiness despite non-enforceable importer registration
  

My Role

As the product lead, I was responsible for:

• Designing a deal-first onboarding funnel, reversing traditional compliance-first models
• Building dual pathways for structured and transactional financing flows
• Aligning deal discovery logic with IFSCA’s ITFS framework and global compliance needs
• Creating stakeholder-specific workflows and visibility mechanisms
• Driving user adoption, platform engagement, and trust among exporters and FIs
  

Approach & Decisions

We structured the solution by answering six fundamental product questions:

a. How to initiate discovery without blocking users with KYC?
We decoupled intent from onboarding. Exporters could submit a Limit Application upfront with invoice volume, currency, average size, and importer geography. KYC was triggered only after a financier showed interest, aligning effort with value.

b. How to enable discovery without exclusivity bias?
Submitted applications were shared with all active financiers (onboarded or not). Each financier could respond with indicative term sheets—limit, currency, tenor, and tentative rate—via a standardized yet configurable interface.

c. How to preserve fairness in whole-turnover setups?
To prevent off-platform bilateralism, we enforced that even whole-turnover deals would require invoice acceptance post-agreement. However, only the selected financier could accept, making the process visible and auditable while respecting exclusivity.

d. How to handle divergent workflows for spot and whole-turnover?
We designed a dual-mode credit logic:

• In spot financing, multiple financiers could assign limits without defining a rate. Rates were discovered dynamically when the exporter uploaded an invoice, and financiers placed competing bids.
• In whole-turnover, both limit and rate were pre-agreed, and invoices flowed directly for approval—no bidding, just acceptance.

e. How to streamline onboarding?
To reduce delays, onboarding and KYC could happen in parallel with the limit application and evaluation—especially when Relationship Managers convinced exporters to start early. This meant exporters could complete compliance checks before or alongside financiers evaluating limits, speeding up the overall process. Clear communication and UI cues were critical to guide users through these parallel steps without confusion.

f. How to make it trustworthy in absence of importer participation?
We built importer data capture around document-backed validations, allowing exporters to upload proof of trade, and financiers to run their own due diligence. This created parallel trust paths without mandating importer registration.

Platform Outcomes and Product Impact

This dynamic discovery and dual-credit model drove tangible outcomes:

• >40% increase in lead-to-onboarding conversion, as users saw value before KYC effort
• 95% invoice success rate post-whole-turnover deal selection
• 3x growth in engagement from global FIs seeking structured trade opportunities
• Allowed platform to scale with diverse financing strategies without compromising auditability
• Created a differentiated product stance—fair, flexible, and cross-border ready
  

Risks & Challenges Addressed

• Importer Enforcement Gap: Designed compliant flows that worked without importer-side onboarding
• Financier Conflicts: Separated logic for rate discovery (spot) vs rate agreement (whole turnover)
• Onboarding Fatigue: Postponed KYC to the point of commitment, preserving funnel top
• Transparency Risk: Built lightweight bidding even into exclusive deals to preserve visibility
• Deal Gaming: Platform restricted multiple parallel acceptances by exporters, ensuring fair deal closure
  

Product Learnings with Broader Applicability

• Design onboarding flows that respect user readiness and compliance realities
  Like how we enabled exporters to start KYC alongside limit evaluation, many fintech platforms—such as Stripe and Plaid—use phased onboarding to reduce friction and speed up access to core services. This approach is vital for regulated products balancing user experience with compliance.
• Build flexible platform logic that accommodates diverse financing or monetization models
  Supporting both spot and whole-turnover financing required modular rules and distinct user journeys to avoid confusion. This mirrors approaches by platforms like Square, which simultaneously handle card payments, installment plans, and other financial products within one ecosystem.
• Balance transparency with exclusivity to build and maintain trust
  Though financiers had exclusive whole-turnover deals, maintaining bidding mechanisms and invoice visibility preserved fairness and auditability. Similar principles apply in marketplaces like Amazon, where competition is balanced with featured partnerships to sustain user confidence.
• Anticipate regulatory and ecosystem constraints by designing adaptable workflows
  Because offshore importers could not be mandated to register, we built flows that work within these limits. Fintech companies such as Wise and Revolut face similar challenges in cross-border payments, designing resilient systems that accommodate varied regulatory environments and limited partner control.

Conclusion

This initiative tackled the inherent complexity of cross-border trade finance—multiple financing models, regulatory constraints, and diverse user journeys—through strategic product decisions. By modularizing flows, enabling parallel onboarding, and balancing transparency with exclusivity, the platform navigated uncertainty while maintaining operational clarity and user trust.