IBM and Seven European Banks Announce a New Trade Finance Platform Based on IBM Blockchain | Coinspeaker

IBM and Seven European Banks Announce a New Trade Finance Platform Based on IBM Blockchain

Tatsiana Yablonskaya By Tatsiana Yablonskaya Updated 3 min read
IBM and Seven European Banks Announce a New Trade Finance Platform Based on IBM Blockchain
Société Générale Towers (in the middle). Photo: Thomas Birke/Flickr

The platform is intended to facilitate domestic and cross-border trade for small and medium enterprises in Europe and increase overall trade transaction transparency.

IBM gets involved in the development of a new trade finance platform based on IBM Blockchain powered by Hyperledger Fabric. For this purpose, IBM was selected by a consortium of seven of Europe’s largest banks consisting of Deutsche Bank, HSBC, KBC, Natixis, Rabobank, Societe Generale and Unicredit.

The platform aims to facilitate domestic and cross-border trade for small and medium enterprises in Europe and increase overall trade transaction transparency. The trade finance processes will be improved as domestic and international trade transactions will be properly managed, tracked and secured. The Digital Trade Chain solution will link all the parties of trade transaction, both online and via mobile devices.

“To make the Digital Trade Chain network a reality and enable it to serve potentially thousands of the consortium’s banking clients, we turned to IBM in enterprise blockchain to help us quickly bring this highly scalable system into production,” said Rudi Peeters, CIO, KBC on behalf of the Consortium. “Their blockchain and banking industry expertise will help us create a new platform for small and medium businesses in Europe that can enable them for faster, easier and cheaper trade transactions.”

The Digital Trade Chain solution is expected to open new revenue streams and initiate new trading relationships and foster trade growth by addressing the financing gap of small and medium enterprises, a traditionally underserved market segment. The World Bank informs that 50 percent of small and medium enterprises do not have access to formal credit.

The platform will ensure accountable and transparent cross-border trade transactions. It will support customers from all banks in the consortium allowing small and medium enterprises trading with new partners domestically or in other European markets.

The Digital Trade Chain also digitizes the entire supply chain process from order to settlement, thus improving some administrative tasks for customers of small and medium enterprises.

“In working with hundreds of clients around the world on a diverse range of blockchain projects, trade finance has emerged as one of the strongest use cases for the technology,” said Marie Wieck, general manager, IBM Blockchain. “By addressing the SME market, which faces challenges in data sharing and access to capital, the Digital Trade Chain Consortium is pioneering a unique blockchain solution with the potential for widespread impact.”

The Digital Trade Chain is scheduled for launch at the end of 2017. The consortium now includes seven banks while is expected to grow to include additional banks from other countries and as well as trading partners such as shippers, freight forwarders and credit agencies.

The Digital Trade Chain concept has already won two industry awards: EFMA-Accenture award for ‘best new product or service in banking’ and the Global Finance award for ‘Innovator in Trade Finance.’

IBM has recently announced a new partnership with Insurer American International Group Inc (AIG) to develop a “smart” insurance policy where blockchain is used to manage complex international coverage.

Tatsiana Yablonskaya

Taking strong interest in blockchain, cryptocurrencies, and IoT, Tatsiana Yablonskaya got deep understanding of the emerging techs believing in their potential to drive the future.

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