KBC CIO Rudi Peeters has revealed why a consortium of seven largest banks in Europe selected IBM to build and host trade finance platform by utilizing IBM Blockchain powered by Hyperledger Fabric.
“IBM’s 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,” said Rudi Peeters, CIO of KBC on behalf of the Consortium.
The solution is anticipated to help open new revenue streams and initiate new trading relationships and foster trade growth for SMEs. According to the World Bank, 50 percent of SMEs do not have access to formal credit.
The platform will increase access to financing by infusing cross-border trade transactions with accountability and transparency. The scalable platform can support customers from all banks in the consortium and helps equip SMEs to initiate trade with new partners domestically or in other European markets.
The Digital Trade Chain also optimizes some administrative tasks for SME customers by digitizing the entire supply chain process from order to settlement, and allows trading partners to track and trace transactions as they are processed.
The trade finance platform is designed to simplify and facilitate domestic and cross-border trade for small and medium enterprises in Europe, while helping to increase overall trade transaction transparency.
Digital Trade Chain Consortium consists of Deutsche Bank, HSBC, KBC, Natixis, Rabobank, Societe Generale and Unicredit.
The Digital Trade Chain solution will run in the IBM Cloud and is designed to connect the parties involved in a trade transaction, both online and via mobile devices. It is designed to simplify trade finance processes by addressing the challenge of managing, tracking and securing domestic and international trade transactions.
“In working with hundreds of clients 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.
Digital Trade Chain network will be built on Hyperledger Fabric v1.0.0, an open source blockchain framework and one of the five Hyperledger projects hosted by The Linux Foundation, and hosted on the IBM Cloud.
The Digital Trade Chain is expected to go into production by end of 2017.
The consortium started in January 2017 with seven European banks and 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.
Image source: Nasscom
