Managing change in Internet-based trade finance has become a full-time job. The work lives of export-import managers and financial officers are being reshaped daily by technology, and the imaginative ways that banks, and others, are harnessing it. And, while the process began a decade ago, the innovations are now coming faster, and they point to even more significant adjustments.

Electronic information is the dynamic centerpiece-how it's created, moved, stored, accessed, and shared. Consider these recent events and trends that highlight what's happening, what's coming next:

JPMorgan Chase Bank, a major global trade services provider, just acquired Vastera, in Dulles, Virginia, a leading software and systems supplier for the international movement of goods. The trade services world is abuzz over its implications.

One thing for sure: it means financial and logistics supply chains keep getting closer. The JPMorgan announcement can be compared in significance with the 2003 UPS acquisition of a Hartford, Connecticut, bank, which the big global logistics company tucked smoothly into its own sizable trade finance unit.

JPMorgan Chase says it is creating a "one-stop shop," a seamless management capability for the complete global trade process. The announcement crowed: "Through this combination, JPMorgan Chase will be the first global financial institution to offer a complete integrated cash, trade and logistics solution across the physical and financial supply chains."

Exporters and importers are now being empowered by independent software and systems suppliers. They can easily compare how banks perform in letters of credit and other services-who's fast or slow, whose fees are high or low.

That is making it possible for them to choose among banks for the best service, even though the foreign buyer's bank, which issues the LC, typically has its own preferred network.

Take the case of ACG Cotton Marketing in Lubbock, Texas, a trading company that does most of its export business through letters of credit. ACG is active in Turkey, but also sells to China and India, all places where the security benefits of an LC are typically needed.

For eight years the Lubbock firm has been using the software and systems programs of Trade Technologies Inc. (Austin, Texas) to prepare documents and present them to banks. In fact, ACG helped test these programs originally, and has been involved in their fine-tuning. Trade Technologies' programs are also being used by two of the largest U.S. trade finance banks

Angie Goodman, ACG president, says: "We ask the buyer's bank to send the LC electronically, and then we can compare how long each paying bank takes to deliver the funds." She tracks the number of days between the time when her company supplies the last document the paying bank needs and when ACG receives the money.

"We found one bank was taking two days, and another five." And the confirmation and other bank fees also varied considerably. "The software program gave us the tools to go to a customer and ask for the best banks to work with, we are able to give them a list based on experience," she explained.

And "if you can achieve the use of funds faster, it makes an amazing difference over a year's time in profitability."

Electronic reports in trade finance keep getting heftier. One significant development just getting underway is empowering a trader to consolidate data involving multiple banks. Until now, that has meant working with separate passwords and proprietary information systems.

Banks have been protective of their own information and their relationships with customers. But JPMorgan Chase is spearheading an approach that will permit a trader to view simultaneously on screen the six LCs it may have with one bank and the twelve it may have with another.

Bruce Proctor, senior vice president and head of Global Trade Services, says his bank's Trade Information Exchange program would be used by customers to see their trade finance data with multiple institutions each day.

"At the moment, 20 of our clients are considering the strategy, which needs to be user-driven. When one gives the green light, we expect others to clamor to get on board." It would be another significant step in the integration of trade finance information.

Trade documents are now being reprinted from the Internet to serve as originals required in trade finance transactions. "Banks can now print out an original Web-based bill of lading and send it out, thus making it possible to pay in only two days," says Chip Thomas, who runs the American Export Training Institute, a specialty group that has educated hundreds traders and bankers in finance procedures.

Companies are somewhat resistant, tend to worry over security and the integrity of the documents, Thomas remarked. "But one software firm (Trade Technologies) has an agreement with over 100 shipping lines that makes it widely acceptable."

Software companies and banks are also increasing their electronic open account services, in which payment is due upon invoice or shipment, thus displacing letters of credit to some extent through an enhanced Internet capability. It's been developing for a while, but new products and greater familiarity and comfort are expected to accelerate its use.

TradeBeam, a software and systems supplier in San Mateo, California, is now coming up with an open account management program. Its new Authority To Pay facility, which will be offered in partnership with banks, is seen as an alternative to LCs. The strategy offers "more rules and more security" without an LC, says Duncan Jackson, vice president, business development and marketing.

"The buyer agrees to the payment terms, and the program reconciles documents and data fields, including invoices, bills of lading, and packing lists. If the program produces a match, the buyer OK's payment," he explained.

A huge amount of consultation between banks and their exporter-importer customers has by now produced years of fine-tuning electronic document production and Internet transmission and viewing.

National City Bank, in Cleveland, for example, has been bringing its customers in to headquarters for periodic meetings, and lets them offer feedback to the bank's operations group on their experience with its on-line trade services. "We let them interact with one another, and be frank about what they like in other banks' programs too," said Craig Schurr, senior vice president, international banking.

And, JPMorgan Chase produces quarterly update releases on its portfolio of trade finance electronic services, based on the feedback it receives. Says Bruce Proctor: "It's a very competitive market, so we are always trying to think ahead.

The Web, in short, is building a huge trade finance network of more savvy exporters, importers, banks, and independent software vendors. Looks like no end in sight for the innovations and the benefits.