IBM chosen by European bank consortium to build trade finance platform
IBM has been selected by seven world-leading European banks to build and host a new trade finance platform based on IBM Blockchain and powered by Hyperledger Fabric. The platform aims to simplify and facilitate domestic and cross-border trade for SMEs in Europe, while helping to increase overall trade transaction transparency.
Via a worldwide competitive bidding process, IBM was selected by the Digital Trade Chain consortium which consists of Deutsche Bank, HSBC, KBC, Natixis, Rabobank, Societe General, and Unicredit.
The consortium will run in the IBM Cloud and is designed to connect all seven parties in a trade transaction, both online and via mobile devices. Thus, trade finance processes are simplified by addressing the challenges of managing, tracking, and securing domestic and international trade transactions.
Rudi Peeters, CIO of KBC said on behalf of the consortium: "To make the Digital Trade Chain network a reality and enable it to serve potentially thousands of the consortium's banking clients, we turned to IBM in enterprise blockchain to help us quickly bring this highly scalable system into production. Their blockchain and banking industry expertise will help us create a new platform for small and medium businesses in Europe that can enable them for faster, easier and cheaper trade transactions."
The solution is also expected to help open new revenue streams and initiate new trading relationships for SMEs – a traditionally underserved segment of the market. According to World Bank, 50 percent of SMEs don’t have access to formal credit. The highly scalable platform can support customers from all banks in the consortium and helps equip SMEs to initiate trade with new partners domestically or in other European markets.
Marie Wieck, Generatl Manager, IBM Blockchain, said: "In working with hundreds of clients around the world on a diverse range of blockchain projects, trade finance has emerged as one of the strongest use cases for the technology. By addressing the SME market, which faces challenges in data sharing and access to capital, the Digital Trade Chain Consortium is pioneering a unique blockchain solution with the potential for widespread impact."
The Digital Trade Chain network will be built on Hyperledger Fabric v1.0.0, an open source blockchain framework and one of the five Hyperledger projects hosted by The Linux Foundation, and hosted on the IBM Cloud. The Digital Trade Chain is expected to go into production by end of 2017.
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