Blockchain Trade Finance Platform Unveiled By Multiple Banking Partners
Reuters has reported that a new blockchain trade finance platform built by a dozen banks, including HSBC, Standard Chartered and BNP Paribas was introduced this week in Hong Kong.
The eTrade Connect platform intends to enhance the competence of international trade financing by minimizing the time taken to approve trade credit applications from thirty – six to just four hours.
According to reports, HSBC generated trade finance revenue of $2.52 billion in 2017, giving it the credit as one of the world’s top banks. Trade finance transactions accounted for more than $9 trillion in 2017, and the industry stays immensely dependent on traditional systems and complex paper – based systems, Reuters said.
The eTrade platform digitizes trading records and mechanizes several trade finance procedures to channelize communications between business partners. Beyond competence, the system is anticipated to decrease the danger of scam in letters of credit (LoCs) and other relevant documents.
The initial triumphant transactions that were performed and confirmed on the latest platform were procurements by Pricerite, a furniture and households merchandise vendor. The company’s chairman, Bankee Kwan, told Reuters that “[b]lockchain has transformed a cumbersome, complex process into a simpler but more secure and efficient way of conducting trade.”
Alongside BNP Paribas, HSBC and StanChart, the Agricultural Bank of China supposedly participated in the creation of the platform and facilitated by the Hong Kong Monetary Authority (HKMA).
Trading platform we.trade, which also points to HSBC as one of the founders bank, alongside Rabobank, Société Générale, UniCredit, Santander, Deutsche Bank, and others, entered into a partnership with Hyperledger Fabric-powered European blockchain to perform its first real-time operations in July this year.
This May, HSBC performed what it was supposed to be “the world’s first ever” trade finance deal powered by blockchain: a LoC (Letter of Credit) for food and agro commodity giant Cargill, the biggest private US company by revenue.