Last week Russia’s Sberbank
announced it completed a pilot blockchain transaction with Singapore commodities company Trafigura. The distributed ledger technology (DLT) was used for the supply of West Siberian oil.
Acting as a forfaiter, Sberbank bought receivables that are owed to Trafigura from a Turkish buyer. The blockchain transaction was carried out using the Hyperledger Fabric platform, which recorded the date, duration of the transaction, scope of delivery, product characteristics and the financial terms of the original trade. Sberbank and Trafigura monitored the process with an online portal.
There is credit risk involved in cross-border dealings, which blockchain aims to eliminate with transparency in the transaction and greater confidence in supporting documentation. Blockchain enables banks to reduce operational risks and cut down on the time for approval of documents. The technology also eliminates manual inputs required in different phases of a transaction.
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