Global banking group HSBC is extending its internet banking platform - which includes online letter of credit (L/C) functionality to its business customers.

The roll out of the bank's in-house platform, HSBCnet, began in Hong Kong and Singapore in 2003, since when its coverage has reached Australia, the UK and certain countries in Asia-Pacific and South America.

Demand led

In Australia, the system was upgraded because of customer demand, but according to a bank official the cost-benefit equation in establishing online services needs to be carefully considered.

"It's cheaper to run an internet platform but the development costs are enormous," explains HSBC Australasia payments and cash management senior manager David Katiforis.

L/C provision

In the 1980s HSBC established a proprietary internet delivery system called Hexagon, but according to Katiforis, the bank is now ahead of the competition in some areas because it offers an integrated capital model with transactional and trade functions.

"A lot of our businesses are increasingly importing or exporting customers and they're able to establish L/Cs and track collections online," he says.

More to come

According to Katiforis, customers in Australia will be able to access a system within the next year that links to treasury and, in two years time, to securities services too.

Another six services will be added over the next 12 months Katiforis said.

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