Hello Pro’s
We have seen use cases where blockchain is used in Trade Finance. Many top banks have participated in these types of pilot projects and had proved the level of transparency and Speed in getting the LC process flow done and thereby getting the competitive advantage among others.
Lets see how Oman did it with one of the global bank…
Oman Oil and Orpic Group – one of the largest oil and gas businesses in Oman
Abu Dhabi National Carpet Factory – leading manufacturer and supplier of residential and hospitality carpets
HSBC Bank Oman SAOG
R3 Corda Platform – An open-source block chain platform
Oman oil Corp is the exporter in the trade, where it exports “polypropylene” to Abu Dhabi National Carpet Factory. The former has appointed HSBC Bank Oman to issue the letter of credit to the exporter.
HSBC Oman advised a fully digitized letter of credit on the block chain, by verifying or transacting all the documents required, Scrutiny of documents via blockhain thereby avoiding all the time consuming paper based approach
The application of blockchain technology allowed the parties to complete the transaction within 24 hours instead of the usual 5 to 10 days.
Nizar al Lawati, chief financial officer at Oman Oil and Orpic Group, said
The company is proud to be one of the first businesses in the country to promote the digitization of trade finance through blockchain.
Sadiq al Lawati, finance and strategy commercial value partner at Oman Oil and Orpic Group, said:
“This Blockchain pilot is an important station in our journey towards digitisation, a journey that started with Artificial Intelligence (RPA++) and continues to embrace new disruptive technologies.”
In one of the case, Archax, a London-based digital securities exchange, revelaed it will use Corda to manage post-trade activities.
In another instance, Oman’s second-largest bank by market value, BankDhofar, started using RippleNet technology for cross-border payments to India. Using the technology, Cross-border transfers via a mobile banking application has been carried “in less than 2 minutes,” thus allowing non-resident Indians living in Oman to conduct real-time payment transfers.
