Small businesses have seen little benefit from the UK’s move toward paperless international trade, despite reforms introduced three years ago that were expected to reduce costs and simplify exports, according to government-commissioned research.
The Electronic Trade Documents Act 2023 made the United Kingdom the first G7 nation to grant electronic trade documents the same legal status as paper versions. The legislation was designed to reduce paperwork, lower courier costs and improve access to trade finance, particularly for small and medium-sized enterprises (SMEs).
At the time, the government estimated the reforms could generate £1.4 billion in net benefits for importers and exporters over the next decade. It also projected that trade in non-agricultural goods with countries such as the United States could increase by nearly 7%.
However, research conducted by Ipsos for the Department for Business and Trade suggests those expected gains have yet to reach many smaller firms. Based on interviews with 23 traders and industry experts, the report found awareness of digital trade reforms among SME owners remains low.
Many small exporters continue to rely on instructions from shipping companies and courier services rather than adopting digital documentation independently. Researchers concluded that wider use of electronic trade documents is unlikely until customs authorities, ports, shipping companies and other key organisations stop requiring paper documents altogether.
The report found that major shipping firms and commodity traders have moved ahead with digital adoption. Electronic bills of lading, which serve as proof of ownership, shipping contracts and cargo receipts, have become increasingly common since the law took effect. Nine of the world’s largest shipping carriers, representing around 75% of global shipping capacity, have committed to fully digitising these documents by 2030.
For smaller businesses, practical obstacles remain. Although electronic documents are legally recognised in the UK, many customs agencies, banks, health authorities and logistics providers still request paper originals during parts of the trading process. As a result, companies often have to maintain both digital and paper systems, adding cost rather than reducing it.
The report also found that many overseas banks and trading partners cannot yet verify UK digital documents because compatible technology is not widely available.
Business groups say stronger government action is needed. The British Chambers of Commerce (BCC) has called for a clear timetable to phase out paper documentation and improve cooperation with major international trading partners.
William Bain, the BCC’s head of trade policy, said too few SMEs were benefiting from the savings digital trade could deliver. He urged governments to invest more resources in implementation and awareness campaigns, while encouraging closer collaboration with business organisations to expand adoption.
A government spokesperson said the UK remains committed to making international trade simpler and more efficient. Officials said work is continuing to remove remaining barriers so that more businesses across the country can take advantage of paperless trading as Britain seeks to strengthen exports in the years ahead.
