Japanese banking group Mizuho together with a Japanese trading conglomerate Marubeni Corporation and Sompo Japan Nipponkoa Insurance Inc. have successfully conducted a test on information transmition via blockchain between Japan and Australia.
For context, it is not the first time when the banking group Mizuho, which is one of the largest financial groups in Asia, dives into blockchain technologies’ exploration and test administration. The company is one of the first Japanese banks to adopt blockchain using Ripple for cross-currency settlement. Also, Mizuho participated in a development of a blockchain-based system able to speed up the processing of cross-border security transactions in the framework of its partnership with Fujitsu.
The operation included all trade-related processes, from issuing the letter of credit to delivering all the related documents. The procedure was completed entirely via a digital platform using distributed ledger technology.
The trial highlighted the following advantages of the described transmition method:
- reduction of time necessary for the documents’ delivery;
- reduction of time required to create and disseminate documents;
- reduction of labour costs through digitisation of documents;
- increased transparency through sharing transaction details with all participating parties.
Mizuho says the initiative demonstrated the benefits of DLT in slashing the delivery times for trade documents, improving transparency and easing administration.
Nevertheless, some issues can’t be ignored. First of all, it is impossible to transmit trade information in blockchain to parties who do not use the platform. Also enabling the transmission of the wide variety of documents necessary for transactions will require standardising the information for blockchain at an international level.
“Building on this trade transaction project, Mizuho aims to further explore the practical business application of blockchain DLT and to offer technologically sophisticated, client-focused services going forward,” – the bank stated.
However, any clear timeline on when a product launch might happen hasn’t been made public.