The project - backed by ANZ, Bank of China, Bank of East Asia, DBS Bank, Hang Seng Bank and HSBC - had its first outing in March 2017 as a proof-of-concept (POC) and has since been pushed to an imminent live production date by the consortium under the guidance of the Kong Monetary Authority (HKMA).

Howard Lee, deputy chief executive of the HKMA, says: “This trade finance platform is the first large-scale multi-bank blockchain project in Hong Kong arising from the fruitful results of one of the HKMA's POC works on trade finance in 2017. I feel really excited about the development as it clearly demonstrates the HKMA's commitment in facilitating and driving the adoption of new and advanced technologies in Hong Kong."

Following a comprehensive tendering process, Ping An OneConnect Financial Technology has been appointed as the technological provider to the Platform and Deloitte as the consulting service provider to support its production deployment.

The platform - which is is built on permissioned blockchain technology using Hyperledger Fabric 1.1 - is undergoing user acceptance tests, and is targeting a launch in September this year. The first product supported will be open account financing, enabling banks and their corporate clients within the ecosystem to submit and record purchase orders, invoices and applications for financing. The banks have also pledged to rope in more participants from banking and other industries, including logistics, into the ecosystem.

The project is one of a succession of live deployments of distributed ledger technology and smart contracts in the labour-intensive, paper-driven trade finance arena, which is seen as a perfect testing ground for the introduction of a permissioned platform connecting the multiple parties involved in a single transaction.

Vivek Ramachandran, global head of growth and innovation, commercial banking for HSBC points out: “The announcement is further proof that blockchain has the potential to digitize trade by eliminating inefficient processes and reducing the amount of unstructured paper."

More products are being primed for load onto the new system and handshakes with other projects across borders are also in the works.

Says HKMA's Lee: "The next major milestone of this project is to link up with other trade platforms in other jurisdictions to further facilitate cross-border trades.”

The first of such connections was foreshadowed in October last year, when Hong Kong and Singapore dumped decades-old rivalry for trade flows in South East Asia and signed a fintech co-operation deal to foster the development of innovative financial technology across the region, beginning with a cross-border linkage of DLT-based trade finance platforms.