Today YES BANK, India’s fourth largest private sector bank, announced that it used blockchain for a commercial paper issuance. It acted as issuing and paying agent for the Rupees 1 billion ($14.6 million) issuance for Vedanta, a natural resource conglomerate.
The solution was developed by New York-based MonetaGo using R3’s Corda technology. Monetago has a track record in the Indian market. It previously launched a system using Hyperledger Fabric to help detect fraud in trade finance. SWIFT India adopted the platform.
“Vedanta will benefit from the digitized and simplified workflow which shortens the laborious process running into hours to just few minutes and complete transparency that this platform offers to all stakeholders,” said GR Arun Kumar, Group CFO, Vedanta Group.
The platform offers several benefits for both issuance and redemption. It reduces the turnaround time, creates an immutable digital record, and provides real-time visibility. If adopted more widely, it could offer a shared network for all participants.
Monetago’s CEO Jesse spoke about YES and Vedanta: “These are big corporations with the ability to move like start-ups, something very rare indeed, especially when dealing with a market this size.”
While YES BANK claims this is the first blockchain commercial paper issuance in Asia, there are others around the world. Three weeks ago EIB, Euroclear, Santander and EY announced they had completed a Proof of Concept.
At the end of last year, Commerzbank, Natixis, Rabobank and ING ran a live euro commercial paper transaction. Commerzbank has run multiple related pilots. One for a money market transaction between Continental and Siemens. And a blockchain repo transaction with Deutsche Börse.