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Blockchain-based trade finance platforms remain undisrupted though widespread of COVID
We have seen in the previous posts regarding a Blockchain-based Trade finance project lead by HSBC – Contour!
The project is going to be live from Q2 2020 in Singapore. The HSBC group claims that even in the terrible break of COVID Epidermic, The so-called blockchain-based Projects are capable of continuing the trade finance activities without any lags.
The Contour team includes the following banks – Bangkok Bank, BNP Paribas, CTBC, HSBC, ING Bank, Standard Chartered, SEB, consultants Bain & Company and technology partner CryptoBLK as well as R3.
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A blockchain trade finance platform developed by eight banks, including HSBC and Standard Chartered, is ready for commercial launch during the second half of this year after completing over US$30 million worth of letter-of-credit transactions last year during its trial period.
Letters of credit using blockchain have helped companies continue with their commercial trades even during the new coronavirus epidemic, said Ajay Sharma, HSBC’s regional head of global trade and receivables finance for Asia-Pacific.
“Leveraging blockchain for trade finance has overcome the physical constraints we are having today,” said Sharma.
The Contour blockchain trade finance platform was previously known as Voltron. The eight banks: CTBC Holding, ING, Bangkok Bank, BNP Paribas, SEB, and Citi have invested into the new company, he said.
HSBC did not disclose financial details. A new company was set up in Singapore in January to onboard more clients’ trade using blockchain, which is a distributed ledger technology. The company will be staffed by around 20 employees by the end of this year, Sharma said.
Few other Similar Projects –
In 2018, a platform dubbed eTrade Connect — backed by HSBC, BNP Paribas, Standard Chartered and nine other banks — launched in Hong Kong.
Trade finance platform we.trade — which also counts HSBC as a founder bank, alongside Rabobank, Santander, Société Générale, UniCredit, Deutsche Bank, and others — collaborated with the Hyperledger Fabric-powered IBM blockchain to complete its first live operations earlier that year.
In China, this spring, a People’s Bank of China-affiliated initiative run by the country’s foreign exchange reserve regulator piloted its own cross-border trade finance blockchain in three major trading provinces.
Blockchain technology has been found to be beneficial across the trade financing process — allowing for the automated verification of customs documents and corresponding financing balances and enabling real-time and transparent data sharing.
In Oman, major oil and gas enterprises and HSBC Bank Oman SAOG conducted their first fully digitized letter of credit on the blockchain using R3’s Corda platform last fall.
