Revolutionising guarantees

Bonds and guarantees are a time-consuming business. But it doesn’t have to be that way. Working closely with market leaders, SaaS platform DVS is developing a digital solution that will make it faster, safer and simpler to execute a guarantee.

Hard built foundations

Across the globe, businesses rely on bonds and guarantees to support their growth. They are essential to the financial system. Yet the processes involved are all too often fraught with cumbersome pain points from end to end.

Even in today’s digital era, the system is multifarious and largely paper-based. This means that creating a bond or guarantee can be very time and energy intensive for all parties. With bespoke agreements, wet-ink signatures and lengthy back-and-forth sign-off procedures, a guarantee or bond can take weeks to put in place and even longer to release.

Mapping new ground 

PwC’s new whitepaper outlines the benefits of digitising the guarantee business, and how this change will come about. Focusing on the experience of major players, such as leading corporates, banks and credit insurers, we provide an independent perspective on the current guarantee landscape.

The paper identifies the typical pain points in today’s processes and examines how digitisation can mitigate them.

Mapping new ground: Centralisation
Centralisation

Under the current system, information is scattered, making it difficult to achieve oversight and control large numbers of guarantees. Digitisation can provide:

  • a single, central repository
  • an up-to-date audit trail
  • streamlined communication
Mapping new ground: Standardisation
Standardisation

Today, each actor in the ecosystem uses different conventions and set-ups. A digital revolution could quickly and efficiently:

  • establish a single set standard 
  • simplify the procedure
Mapping new ground: Automation
Automation

Perpetual paperwork leads to inefficiencies in processing and an increase in the risk of error. An automated system would:

  • eliminate potential for human error
  • speed up the process

We also discuss the hurdles towards digitisation and the factors necessary for a successful digital revolution of the system.

Security, validity, acceptance
Security

When it comes to bonds and guarantees, the stakes are high – there can be no compromise on data security and integrity. 

Validity

The legal framework must enable confidence in the digitised system: the validity and enforceability of the guarantee is key.

Acceptance

The solution must be something that works for all parties. Banks, credit insurers and the corporates - both the issuers and beneficiaries - must all be on board.

New horizons

This whitepaper is based on the results of a survey with members of the DVS working group, and interviews with market leaders, as well as PwC’s in-house expertise and market knowledge. Our findings suggest that when the above prerequisites are met, and the digital solution is refined, the guarantee business could become fully digitised in the space of as little as three years. 

Recent developments indicate that the digital transformation is already underway. This year the first fully digital transactions took place in Germany and Austria, hosted by DVS’s digital guarantee platform. Countries like France and Switzerland are expected to follow close behind.

Download the whitepaper below to find out more about what lies ahead for guarantees, bonds and sureties.

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Contact us

Didier Vandenhaute

Didier Vandenhaute

Partner, PwC Belgium

Tel: +32 475 91 06 78

Marco van Harten

Marco van Harten

RBR Treasury Specialist, PwC Belgium

Tel: +32 471 991 901

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