KPMG LLP has partnered with the Blockchain in Transport Alliance (BiTA) to help develop blockchain standards for the transport industry.
However, that is not the Alliance’s only goal. They also aim to provide educational leadership and to encourage collaboration between members.
Collaboration and common standards are crucial for the shipping industry. Growth is based on the costs and risks that are linked with the increasingly interconnected logistical systems. So, getting industry-players to agree on changes and improvements could see them reap massive benefits.
However, unlike the IBM and Maersk joint venture, and the Accenture consortium, whose focuses are on tracking and transparency, BiTA is concentrating on providing a monetary justification for companies to adopt blockchain.
Craig Fuller, CEO of FreightWaves, the firm responsible for running the Alliance on a daily basis, explained: “Payment is an example where it’s not a stretch to take blockchain and apply it to payments, because fundamentally blockchain is built upon the movement of money and it’s also one that’s somewhat readily available, that isn’t going to have a ton of market friction to it.”
“So if you can take a cost of capital and a payment cycle say from 300 basis points (3%) to 30 basis points and receivables payment cycle from 60 days, or 45 days down to five days or three days or immediate, then you have a ton of value that you can bring companies, and they’re more likely to adopt it.”
KPMG’s U.S. Blockchain Leader Arun Ghosh commented: “Even with major advances in technology, transport logistics remain expensive and vulnerable. Blockchain has the potential to solve these issues and disrupt many of the systems that freight organizations have relied upon for decades, while creating greater transparency, speed, reliability and trust within organizations’ core operations, including their supply chain.”
Chris Burruss, BiTA President added: “We believe that blockchain will fundamentally change the transportation industry. We are very proud to have KPMG join BiTA. Their global reach and perspective across advisory, audit and tax is invaluable in establishing the industry standards that will determine blockchain’s use in freight for years to come.”
BiTA was founded in 2017 and has grown quickly. It boasts nearly 500 members among them household names like Google, Uber, UPS and FedEx.