Yesterday the
European Investment Bank Group announced that it granted BBVA a €60 million synthetic guarantee to be used to finance up to €360 million new investment projects for Spanish SMEs. The blockchain-based deal is intended to enable financing at favorable terms such as lower rates or longer repayment periods.
The European Investment Bank Group was formed by the European Investment Bank (EIB) and the European Investment Fund (EIF). The EIB, EIF and BBVA negotiated the deal using blockchain technology, so all the steps from the start to signing were logged on the blockchain. The project uses Hyperledger Fabric and has now been used to negotiate several different types of BBVA loans. In most of the previous cases, BBVA was granting the loan.
Nowadays banks have complex requirements about how much capital they need for different purposes to ensure liquidity. By getting a guarantee from the EIB Group, this frees up capital for BBVA.
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