A group of seven banks anticipates going live this year with a blockchain-based trade finance platform for small- and medium-sized enterprises (SMEs).
The platform aims to simplify trade transactions, make know-your-customer (KYC) compliance easier and domestic and cross-border trade for smaller businesses more transparent.
The seven banks – Deutsche Bank, HSBC, KBC, Natixis, Rabobank, Societe General and Unicredit – recently chose IBM to work on the new blockchain-based SME-oriented trade finance platform.
IBM will build and host the platform for the banks, collectively known in this venture as the Digital Trade Chain Consortium.
The platform will be based on the Linux Foundation’s Hyperledger Fabric blockchain and will operate over the IBM Cloud.
Trade finance gap
The developers say 50 per cent of SMEs do not have access to credit and hope that the blockchain solution will reduce KYC and transaction costs and thus help to close the trade finance gap.
The Digital Trade Chain Consortium plans to launch the new platform by the end of 2017.
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