Why does Trade Shield use bank statements?

In 2021, South African banks started changing the way third parties could access bank codes due to the Protection of Personal Information Act (POPIA).

• FNB was the first to announce (July 2021) that they would no longer provide bank codes to third parties.

• ABSA followed shortly after.

• Standard Bank and Nedbank still provide codes, but only with explicit director consent.

This change caused concern among many businesses that relied on bank codes to assess affordability.

What solution did Trade Shield develop?

To address this, we created the Bank Statement Analysis (BSA) tool.

• The tool uses OCR (Optical Character Recognition) to read system-generated PDF bank statements.

• From these statements, the system extracts the same core data points that a traditional bank code would provide.

• In July 2021, we further enhanced this capability by partnering with TruID, who specialize in secure bank-statement processing.

How is Trade Shield’s approach different from traditional bank codes?

Traditional bank codes typically check the last 7 days of account activity.

Trade Shield improves on this by:

• Analysing the last 30 days of activity.

• Applying the 7 Cs of Credit framework to better assess affordability and risk.

• Using three months of bank statements to calculate an estimated turnover of the business.

This gives a more accurate, reliable picture of a company’s financial behaviour.

Why do you require 3 months of bank statements in PDF format?

We ask for system-generated PDFs directly from the bank (not scanned or manually altered documents) because:

• They are harder to edit or manipulate, ensuring authenticity.

• Three months provides enough history to establish a clear pattern of income, expenses, and turnover.

Do bank statements replace financials?

Not entirely.

• Bank statements give a real-time affordability view and help with turnover estimation.

• Financial statements are still important and are processed through our Moody’s integration for in-depth affordability and credit risk scoring.

Together, these data sources provide a robust, multi-layered view of a customer’s financial health.