HKMA & Banks Reveal Blockchain Trade Finance Setup

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The Hong Kong Monetary Authority alongside 7 banks, including Standard Chartered and HSBC will jointly launch a trade finance platform using blockchain Technology which underpins digital currencies like bitcoin, in September 2018.
The Hong Kong Monetary Authority alongside 7 banks, including Standard Chartered and HSBC will jointly launch a trade finance platform using blockchain Technology which underpins digital currencies like bitcoin, in September 2018.

The new trade finance platform will be one of the largest examples in global sense of a government-led, cross-bank effort to rebuild the multi-billion-dollar sector.

Additionally, trade finance is usually described as one of the most paper-oriented and manual parts of the financial services industry. Insurers, banks and export credit agencies work as the middle link between exporters and importers, to make sure both sides are protected from financial risks such as political instability, currency fluctuations, as well as problems regarding non-payment or the creditworthiness of the companies involved.

In addition, the blockchain project is anticipated to rapidly minimise the amount of paperwork and time required, especially for international trade, and permit banks to serve current and new clients more efficiently.

The HKMA stated the next major milestone is to llink up with the other trade platforms in other jurisdictions to further facilitate cross-border trade.

Lastly, the trade finance platform will be provided by Ping An Insurance.