Today Lloyds Bank announced that it is the first UK bank to join blockchain consortium komgo. ING, ABM Amro, and Societe Generale founded the group to streamline trade finance for international commodities trading. Launched last year, the Geneva-based consortium boasts backing from Shell, Mercuria, and MUFG amongst 15 bank and commodities investors.
The komgo platform, based on JP Morgan’s Quorum, utilizes blockchain to tackle fraud, increase efficiency, and digitize trade. The founding banks saw room to improve on often complex international trade finance.
As Gwynne Master, MD and global head of trade for Lloyds Bank Commercial Banking, put it: “‘Cumbersome’ and ‘time-consuming’ are just two words used to describe international trade today.“
She explained: “The process of trading a single commodity can take over 100 days, involves many players, considerable paperwork, and risk. Trade is particularly onerous for our commodities clients, where faster turnaround times and a streamlined channel are key requirements.”
“Our partnership with komgo helps us tackle these challenges. We’re working together to shorten the time it takes our corporate clients to trade internationally by significantly streamlining and digitising the process,” Master said.
Indeed, the komgo platform has digitized Letters of Credit and managed transactions for North Sea oil with blockchain. One of its products is a Know Your Customer (KYC) compliance solution. It sets itself apart from other consortiums by focusing on commodities and having support from some of the largest firms in the sector; not just banks.
The CEO of komgo, Souleïma Baddi, said: “We are thrilled to welcome Lloyds Bank on komgo’s network, and very excited to support their clients to get the best out of it in the following months.”
“We’re entering a new era of simpler and more inclusive access to blockchain technology that has the potential to support strong, collaborative business relationships,” Master added.