Leading banks like StanChart, BNP Paribas and HSBC with others launched Hong Kong Blockchain Trade Finance Platform
A brand new trade finance platform on blockchain developed by a group of dozen banks, including BNP Paribas, Standard Chartered and HSBC, launched this week in Hong Kong, as reported by Reuters on October 31.
Dubbed as eTrade Connect, the platform plans to work towards making the process of financing in international trade by minimizing the approval time for trade loan application to just four hours from thirty-six hours. Reportedly, HSBC earned $2.25 billion in 2017 from trade-finance, marking itself as the leading global banking leader of the industry.
As per Reuters, in the year 2017, the trade finance transactions were accounted for around $9 trillion, while the industry remains dependent on inefficient paper-based systems and legacy systems.
By streamlining the counterparties interactions, the eTrade platform digitizes documents and automates most processes of trade finance. Apart from efficiency, the system is also expected to strengthen the security by mitigating the risks of fraud in letters of credit (LoC) and other related documents, the report from Reuter noted.
Pricerite, a household and furniture retailer became the very first one to successfully transected and got confirmation on the new platform. Talking to Reuters, Bankee Kwan, the chairman of the company said, “[b]lockchain has transformed a cumbersome, complex process into a simpler but more secure and efficient way of conducting trade.”
Together with StanChart, HSBC and BNP Paribas, the Agricultural Bank of China was also reportedly involved in the development of the platform, which was facilitated by the monetary authority of Hong Kong.