Small firms were meant to be the biggest winners from Britain’s shift to paperless trade. Three years on, government-commissioned research has found them “untouched” by the reforms, while large companies and shipping carriers quietly pocket the savings.

The Electronic Trade Documents Act 2023 made the UK the first G7 country to give digital trade documents full legal status, promising smaller exporters lower courier fees, less administration and better access to trade finance.

The scale of the potential prize is hard to overstate. The World Trade Organisation estimates that a typical cross-border transaction requires the exchange of 36 documents and 240 copies of the paperwork. The government suggested the reforms could generate £1.4 billion in net benefits for importers and exporters over ten years, with bilateral trade with a country such as the US rising by 6.8 per cent for non-agricultural goods.

Yet evidence gathered by Ipsos for the Department for Business and Trade, drawn from 23 interviews with traders and industry experts in March, tells a different story. Awareness of the reforms among small business owners is “low”, and most simply follow whatever their courier asks for rather than driving change themselves.

The researchers concluded that widespread adoption of electronic trade documentation would only happen “once Customs authorities, carriers, and ports stopped issuing physical paper.” The common view among experts was that “voluntary adoption by small businesses would not scale, and that progress depended on co-ordinated action by the government and large supply chain actors.”

The big players are not waiting. Use of electronic bills of lading, the legally binding document that acts as receipt, contract and proof of ownership in one, has doubled since 2023, but largely thanks to major commodity traders and shipping lines. Nine of the biggest carriers, representing 75 per cent of global capacity, have committed to 100 per cent digital adoption by 2030.

For the SME owner, the practical catch is worse than the awareness gap. Even where digital documents are legally accepted, Customs, health authorities, banks and couriers “still require paper originals for some steps”, so early adopters end up running costly hybrid paper and digital processes. Overseas banks and trading partners may reject UK digital documents simply because they lack the software to verify them.

Nor did Whitehall’s sales pitch land. Government messaging about “improved access to trade finance” did not resonate with owners, who were far more interested in direct savings on courier fees and less red tape, a familiar refrain from firms already frustrated by post-Brexit border checks and paperwork.

The findings have prompted the British Chambers of Commerce, which has repeatedly warned that small exporters are being left behind while larger firms surge ahead, to call for paper documentation to be phased out and for closer co-ordination with the UK’s leading trading partners.

William Bain, head of trade policy at the BCC, said: “This research paints a clear picture: that governments, globally, must work together better to advance digital trade.

“It is a travesty that far too few SMEs are taking advantage of the time and cost savings that a shift to using online documentation can bring.

“This is not just about authorities passing laws to digitise documents, it also needs them to get behind the drive to increase take up. This should include a timeline for phasing out paper-based documentation.

“More resources also need to be invested in implementation by the government. Our chamber network is ready to work in partnership with them to raise awareness and fully embed digitisation into our trade culture.”

With Britain nursing a £74 billion slump in goods exports since Brexit, the stakes for getting smaller firms trading efficiently are considerable.

A government spokesperson said: “Making trade paperless saves businesses a lot of time and money, which is why the UK was the first G7 country to give electronic documents full legal status.

“We want more business across the country to benefit from these changes, and are working hard to address remaining barriers so we can make digital trade simpler, faster and more efficient.”