BofA Merrill Lynch and HSBC use blockchain for trade finance

posted almost 6 years ago
Bank of America Merrill Lynch, HSBC and the Infocomm Development Authority of Singapore (IDA) are using a blockchain prototype to streamline the paper-heavy world of global trade. The consortium used the Linux Foundation open source Hyperledger Project blockchain fabric, supported by IBM Research and IBM Global Business Services.

The application mirrors a paper-intensive Letter of Credit (LC) transaction by sharing information between exporters, importers and their respective banks on a private distributed ledger. This then enables them to execute a trade deal automatically through a series of digital smart contracts, said a statement.

The proof of concept shows potential to streamline the manual processing of import/export documentation, improve security by reducing errors, increase convenience for all parties through mobile interaction and make companies' working capital more predictable.

The consortium now plans to conduct further testing on the concept's commercial application with selected partners such as corporates and shippers.
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