Mercantile Bank PLC has taken a significant step forward in its digital transformation efforts by successfully completing a Proof of Concept (PoC) for a blockchain-based inland Letter of Credit (LC), commonly referred to as a “Green LC.” According to a recent announcement, this initiative represents the bank’s first transaction of its kind, conducted through a locally developed digital trade platform.
The launch event was held on June 25 at the bank’s head office, where Mercantile Bank’s Managing Director, Mati Ul Hasan, officially inaugurated the ceremony. The project was executed in collaboration with Spectrum Software and Consulting Limited (SSCL), a key technology partner in the venture. One Bank PLC served as the beneficiary bank during the transaction.
Aligned with Central Bank’s Vision
This PoC aligns closely with the policy guidance issued by Bangladesh Bank in January 2025, specifically outlined in its FE Circular No. 06. The directive advocates for the adoption of electronic and paperless mechanisms throughout all phases of LC operations, including transmission, advising, document presentation, acceptance, and related communications.
By executing the Green LC using blockchain infrastructure, Mercantile Bank has demonstrated compliance with this national objective while showcasing its capability to support secure and efficient trade digitization. The successful PoC reflects the bank’s readiness to embrace innovative digital solutions that reduce reliance on manual processes and physical documentation.
A Collaborative Digital Milestone
The blockchain-based trade platform utilized for this initiative was developed locally, emphasizing the strength and potential of homegrown financial technology in Bangladesh. The involvement of One Bank PLC and SSCL as collaborative partners underscores the growing ecosystem of institutions working together to foster digital innovation in the country’s financial sector.
Senior executives from Mercantile Bank played a prominent role in the event. Among those present were Shamim Ahmed, Deputy Managing Director and CAMLCO; Ashim Kumar Saha, Deputy Managing Director and Head of the International Credit and Coordination Division (ICCD); and Dr. Md Zahid Hossain, Deputy Managing Director and Chief Business Officer. Representing SSCL, Farhanur Rahman, Director of Enterprise Sales, also attended the launch, highlighting the technological collaboration behind the initiative.
Reinforcing Commitment to Trade Digitization
The Green LC transaction marks a pivotal advancement for Mercantile Bank, further cementing its commitment to digitizing trade operations. By leveraging blockchain technology, the bank aims to build a fully digital, secure, and paperless ecosystem for inland LC processing.
Industry observers view this move as a progressive alignment with global best practices in digital trade finance. The use of distributed ledger technology is expected to bring enhanced transparency, traceability, and efficiency to the LC lifecycle, minimizing errors and processing delays.
With this milestone, Mercantile Bank PLC has reinforced its position at the forefront of trade digitization in Bangladesh. The PoC demonstrates the bank’s strategic vision to modernize operations in line with regulatory guidance and evolving customer expectations.
As the financial sector continues to evolve, initiatives such as the Green LC are anticipated to drive wider adoption of digital platforms across the banking industry. Mercantile Bank’s successful participation in this Proof of Concept signals a promising shift toward a more agile and technologically empowered future for trade finance in the region.