Microsoft and BAML joined forces on blockchain-based trade finance project

The two multinationals said at the Sibos event that they would build and test the technology and create a blockchain-based framework that could eventually be sold to other businesses.

Blockchain works as an electronic record-keeping and transaction-processing system that allows all parties to track information through a secure network and requires no third-party verification.

Proponents of the technology, which originates from digital currency bitcoin, say that it will make all kinds of transactions faster, more reliable and easier to audit because it does not require manual processing, nor authentication through intermediaries.

Trade transactions using the existing process typically take between seven and 10 days to complete and involve a complicated paper trail that is vulnerable to document fraud, reports Reuters.