Today Standard Chartered in Singapore announced it completed a cross-border trade finance transaction, the first for the bank in the region. The transaction financed a shipment of chickpeas that originated in Australia for delivery to BSM Global in Bangladesh. The supplier was Agrocorp which participated in other transactions on the same platform last year with DBS Bank.
The primary benefit is the system reduces the time to complete the transaction from five or more days to less than 24 hours. “The transparency of the whole process also helps build trust and loyalty across the supply chain to promote more cost-efficient products and services,” said Ujjwal Jain, Head of Trade for StanChart Singapore. “This is a win-win for all parties.”
The trade platform was developed by Singapore-based Distributed Ledger Technologies (DLT) which last year announced transactions with DBS Bank and Agrocorp. In November DLT launched its Software as a Service platform and claimed to have 124 trading partners in production. The company says it plans to “uberize” the trade finance model. In addition to making trade more efficient and enabling finance, DLT wants to enable traceability. That will include farm practices including water, fertilizer and pesticide usage.
DLT’s blockchain is based on Hyperledger Fabric.
StanChart and blockchain trade finance
This isn’t Standard Chartered’s first foray into blockchain for trade finance. The bank is a member of the R3 Marco Polo trade finance consortium where the technology partners is TradeIX. In August last year, the bank announced that it was working with TradeIX and Siemens Financial Services to develop blockchain-based bank guarantees for financial services. The technology used is R3’s Corda.
The bank is also a founding member of eTradeConnect the trade finance platform set up by the Hong Kong Monetary Authority which launched at the end of October and is powered by Hyperledger Fabric.