Four more banks join IBM/UBS blockchain trade finance platform
04 October 2017 | 9096 views | 0
IBM is collaborating with five international banks on the creation of a global trade finance platform based on blockchain technology.
Bank of Montreal (BMO), CaixaBank, Commerzbank and Erste Group have joined an initiative launched by UBS and IBM in 2016 to build the new platform, dubbed Batavia.
The development work is being done collaboratively by the five banks and IBM in consultation with transportation industry experts as well as the banks’ customers, with the aim of running the first pilot transactions on the network in early 2018.
The trade finance business, comprised of multiple trading partners and mounds of paperwork, is viewed as a sector ripe for the introduction of immutable shared ledgers.
Batavia will allow transacting parties to view the progress of a shipment as it leaves the warehouse, is loaded onto a plane, truck or boat and arrives at the receiving port, automatically releasing payments incrementally along each step of the process.
Beat Bannwart, head strategic innovation & market development, corporate & institutional clients at UBS, says: "Through working closely with our clients, we aim to innovate their user experience through a simple, digital and automated way of arranging, securing and financing their international trade transactions by leveraging new technology and creating an open ecosystem."
He says the open nature of the platform, which encourages broad participation by many banks, vendors and regulators, will also help open new trade corridors, bring new players into the market and expedite processes that before were prohibitively time-consuming and expensive.