Over 50 Banks, Firms Trial Trade Finance App Built With R3’s Corda Blockchain
ABN Amro, Standard Chartered, ING and around 50 other banks and companies have participated in tests of a trade finance application called Voltron.
The open industry platform was initiated by eight founding member banks with the aim of improving the trade finance process by simplifying letter of credit transactions to deliver speedy settlement times and resolution of discrepancies, as well as improved sanctions screening, according to an announcement from distributed ledger startup R3.
The tests saw firms across 27 countries use Voltron, which was developed by R3 using its Corda platform, to make simulated letter of credit transactions. While the existing process is paper-based and time-consuming, Voltron processes transactions in “under 24 hours” as compared to the 5-10 days it traditionally takes, R3 said.
The trial was delivered on Microsoft’s Azure cloud platform in a collaboration between Bain, CryptoBLK and R3.
R3 said 96 percent of the trial participants concluded that Voltron would help them improve trade finance processes and reduce costs.
Denis Dodon, head of innovations at participating member Alfa Bank, said:
“Everything is done in the same interface, which is connected to all the workflow participants, information is shared instantly, what will significantly expedite the transaction, optimizing working with documents, which could be rectified in an instant way should there be any discrepancies identified.”
The platform, R3 added, is “significantly faster, more reliable and cost-effective,” removing time-consuming reconciliation processes by providing a “single, immutable record of a trade.” It also brings the added benefits of a reduction in fraud risk.
Calling for other banks and corporates to join the effort, R3 CEO David E. Rutter said the trial is a “step closer to shaping what the future of trade finance looks like.”
Other participants in the trials included Societe Generale, CommerzBank, Commercial Bank of Qatar, MUFG, Natixis, National Bank of Egypt and the Saudi British Bank.
R3 image via CoinDesk archives