International banking giant Standard Chartered is reportedly partnering with the financial arm of tech manufacturing giant Siemens I a pilot project geared towards putting bank guarantees for trade finance on a blockchain. A report from IBS intelligence revealed that the project will also be assisted by digital ledger firm Tradeix. The project main goal is to move the process away from the traditional paper-intensive exercise as we know it, to a fully digitized bank guarantee issuance process using automated smart contracts. The project will be built on the back of blockchain startup R3’s open source Corda platform with an application layer provided by TradeIX.
The head of transaction banking at Standard Chartered UAE, Motasim Iqbal, termed the project as an “industry defining solution” that will transform the way guarantees are issued and processed. If the pilot test proves successful, it will pave the way for Siemens to bring in new efficiencies that will serve large clients, digitize guarantee issuance as well as amendments and claims. According to Siemens chief financial officer Michael Bueker’s prediction, integrating the blockchain with trade fince solution into the firm’s daily operations would streamline the processes and lead to trade fiannce operations becoming smoother, more effficent and faster.
Standard chartered global head of trade chimed in on the partnership by backing it heavily and ststing that the future of trade is going to be all about data. TradeIX CEO, Rob Barnes, also lauded the project ststing that global trade was about to undergo a multilevel digital transformation that would revolutionize the entire business and its operating model. The news of this project marks yet another coup for R3’s Corda platform after the Bank of Thailand announced last week that iw woulkd be using R3’s technology to create a central bank digital currency.
The pilot test was officially launched in march this year and is schedulaed to be completed later this year. This is not UK based international banking giant Standard chartered’s first foray into the blockchain space. Back in 2015, the banking giant was already backing the blockchain to aid in trade finance. Since 2015 standard chartered has embarked on various tests and has gone into development partnerships on matters blockchain. Most recently the banking entity poartnered with blockchain based remittance service, Ant financial, who are also payment affliates of ecommerce giants alibaba.
