The launch of the system, designed by China-based Ping An Group, will be a government-led project aimed at upgrading the USD 9 trillion global trade finance industry.
Blockchain is expected to reduce the time and paperwork needed to push through routine trade finance and supply-chain finance transactions by making it easier to verify each step of the complicated process and confirm the credentials of the parties involved.
A number of bank-led trade finance platforms that use blockchain are already under development. In May 2018, HSBC announced it had executed the world’s first commercially viable trade finance transaction using blockchain. Deutsche Bank and Rabobank have joined forces to launch similar businesses.
The platform will be owned by the banks that have partnered with the Hong Kong regulator. The final number of financial institutions has not been confirmed but 21 banks are expected to join, including HSBC and Standard Chartered.
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