Abu Dhabi Commercial Bank Integrates Trade Finance Blockchain

HashFlare

ComputerUniverse Введи промокод FW7FRUX при покупке и получи скидку 5 евро

One of the UAE’s largest banks has adopted a blockchain bookkeeping platform of physical trade from Singapore-based firm dltledgers, according to Ledger Insights, September 3, 2019. The first transaction was the movement of goods worth $6.5 million from Canada to Bangladesh; this effectively makes Abu Dhabi Commercial Bank the first bank in the region to utilize an end to end blockchain for trade financing.

Settlement Over the Blockchain

For trade finance, the most integral aspect for improving functionality is speed and transparency. While the former is difficult to achieve with a blockchain, the latter is only possible by using a distributed database. By providing a common platform for various business to come together and accomplish trades, accessibility and communication are no longer barriers.

More importantly, fraudulent activities that run rife in international trade can be eliminated to a large degree. At the same time, by using an automated payments system, it is impossible to cheat the counter-party and assures participating organizations that obligations will be fulfilled.

Singapore’s largest agricultural trading company, Agrocorp, was involved in the first transactions along with Islami Bank from Bangladesh and Richardson International Shipping from Canada.

Agrocorp is one of dltledger’s largest clients with over $100 million in processed transactions completed over the platform. Nitin Jain, head of treasury & capital markets at Agrocorp suggests that almost 15-20 percent of total cost can be eradicated by using dltledger.

The platform has processed a cumulative $1 billion above in trade finance in just 18 months.

Addressing a Colossal Market

The trade finance market is roughly $8 trillion in size, so the opportunity at hand for companies involved in optimizing the space is huge. Dltledgers, which is pioneering this space, has over 30 banks and 400 trading partners that utilize its platform.

Transparency is a key tenet of business, since any significant trade requires settlement on a mutual database. Improving this segment can usher in a new era of physical trade.

When it comes to industry-wide trends, blockchain disrupts no other sector like it does to finance in general. The size of the market is huge and the need for transparency and verification is fairly obvious. The only major constraint is that distributed databases tend to compromise speed in exchange for transparency and trust.

Like BTCMANAGER? Send us a tip!
Our Bitcoin Address: 3AbQrAyRsdM5NX5BQh8qWYePEpGjCYLCy4