Commerzbank reports first digital transactions via distributed ledger technology

Tuesday 1 June 2021 15:25 CET | News

Commerzbank and Germany-based Landesbank Baden-Württemberg (LBBW) have reported their first fully digital transaction using Marco Polo's distributed ledger technology. 

Following preparations that began in 2017, the first trading transaction with blockchain-based payment protection was carried out. Retail transactions were carried out in a live environment via the Marco Polo trade finance network, without a parallel paper-based process. Processing via blockchain can be done in a few hours, since the manual checking of paper-based documents is replaced by the automatic comparison of digital trade data. In the future, a connection to enterprise resource planning (ERP) systems should be established, so that transaction information can be processed further in an automated manner.

The first cross-border transaction took place on 10 May 2021, in which the payment on open account was replaced by a ‘Promise to Pay agreement’. The Marco Polo Payment Commitment is a promise by the buyer's bank to the supplier to make payment on the due date. The Promise to Pay is based on an exchange and comparison of digital trade data in the distributed ledger technology blockchain network of the trade finance network. The distributed ledger from Marco Polo is based on the Corda blockchain technology from R3. Communication takes place in its own network operated by Fintech TradeIX. According to a Commerzbank representative, this transaction is a step towards a market launch.

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Keywords: partner, transactions , ERP, distributed ledger technology
Categories: Payments & Commerce
Countries: Germany
This article is part of category

Payments & Commerce