Singapore-Vietnam Pilot Tests Digital Credentials to Speed Up Letter of Credit Checks

PILA, a Vietnamese trade finance company, and TOTM Technologies, a Singapore-listed firm, have signed a memorandum of understanding to test digital credentials for letter-of-credit checks. The pilot project aims to verify the authenticity of letters of credit (L/Cs) between Vietnamese and Singaporean banks, potentially streamlining cross-border trade finance.

The proposed system would add a digital verification layer without replacing the existing L/C or altering the parties' legal obligations. TOTM's August 13 filing identifies verifying L/Cs as the initial trade-finance use case, but no participating banks, implementation timeline, or performance results have been disclosed. The verification process currently involves phone calls, SWIFT checks, and manual reconciliation of supporting documents, which can take several days.

Under the proposed model, a Vietnamese bank would issue a verifiable credential alongside an L/C, allowing a receiving bank in Singapore to use it to confirm the issuer's identity and ensure the underlying information has not been altered. Singapore's adoption of cryptographic authentication through Singpass is part of a broader push to enhance digital identity security.

PILA will handle credential issuance and verification through NDAKey, while TOTM will integrate the Singapore system with the Infocomm Media Development Authority's TradeTrust framework. The proof of concept (PoC) aims to reduce manual verification, lower fraud exposure, and speed up the process. However, no performance benchmarks have been published yet.

The project comes as ASEAN develops a broader framework for regional digital commerce, with negotiations on the ASEAN Digital Economy Framework Agreement concluding in May 2026. The agreement, expected to be signed in November 2026, covers digital trade, cross-border e-commerce, data governance, digital identity, electronic payments, and cybersecurity cooperation.

The Singapore-Vietnam pilot links two economies deeply embedded in regional technology trade, with Singapore forecast to see strong growth in AI-related electronics exports and manufacturing. The pilot's evidence will determine if the model can expand beyond its current scope, with named bank participants, interoperability results, and measured verification times providing the first concrete indication of the architecture's financial-institution scale potential.