Payments between the German export customer Schott and the Thai import customer A.P.A. Industries were secured by digitally processing the related data transfer via Corda blockchain technology on the Marco Polo trade finance network.

The transaction comprised the supply of glass tubes from the German specialty glass manufacturer Schott to the Thai packaging manufacturer A.P.A. Industries. APA uses the glass tubes for high-end pharmaceutical packaging for the Asian market.

For the transactions, order and delivery data were agreed between the companies via the Marco Polo network and the payment was secured by a conditional payment commitment from Bangkok Bank, the buyer's bank. The entire flow of information was efficiently and comprehensibly mapped via R3’s Corda DLT platform. All parties involved (A.P.A. Industries, Bangkok Bank, Commerzbank and Schott) were able to communicate and view trading data simultaneously via specially set up digital nodes.

"We are very pleased to have partnered with our client Schott in this pilot, handling an international trade transaction between Germany and Thailand via DLT-based technology. These transactions prove how relevant DLT will be for German SMEs and the export industry. We are happy to be one of the drivers to develop this digital solution for trade finance and to support clients with our expertise”, says Enno-Burghard Weitzel, head of product management trade services at Commerzbank AG.

Securing payments for commercial transactions with traditional instruments is often complex and lengthy due to the many intermediaries and the large number of physical documents involved in the process. Using Trade IX's DLT platform provides opportunities to make trading easier and faster. After the second successful pilot project, the focus is now on the complete mapping of transactions via the Marco Polo network with direct connection to the customer's existing supply chain management systems (ERP integration). It is planned to expand the network with additional banks and participants from the transport and insurance industries in order to map the entire value chain in the foreign trade business.

Mark Siegel, Senior Manager Treasury at Schott says: “We expect DLT to significantly simplify and accelerate our international business and are pleased that we were able to participate as a partner in this pilot project. ” The German corporate hopes DLT technology and the Marco Polo project will help significantly increase and standardize automation in trade finance.

“The participation in the pilot project has also allowed us to gain more experience with the DLT technology that we will be able to use in other areas,” said Dieter Worf, head of treasury at SCHOTT.

Marco Polo is a Trade Finance project of R3’s blockchain consortium. The provider TradeIX and the member banks develop different solutions supporting Trade and Supply Chain Finance. Meanwhile 22 banks from Europe, Asia-Pacific, Russia, Middle East and North and South America have joined the initiative.