Standard Chartered Bank has successfully completed its first cross border Letter of Credit (LC) transaction over the Voltron blockchain platform, the firm announced in a press release.
According to the announcement, the pilot LC transaction was executed for PTT Group, PTT International Trading Pte Ltd and IRPC Public Company Limited, and involved the shipment of oil products from Thailand to Singapore. Standard Chartered used the Voltron blockchain platform to digitise and simplify the exchange of information between all participants. Samuel Mathew, Global Head, Documentary Trade Product Management at Standard Chartered Bank, said in the press release:
“This pilot transaction marks the first of many that will follow from our participation with Voltron to digitise trade and enhance the client journey. As our clients increasingly look to technology to address the challenges of today’s global trade environment, we are extremely optimistic and excited about the potential opportunities that Voltron brings to the industry with its demonstrated benefits in improved speed and reduced risks of settlement, as well as its flexibility in connecting banks, businesses and other third-party providers in its network.”
Oil companies often use LC for short term trade finance, mainly because of the significant value of their cargo, but the process is “paperwork-intensive” and usually requires up to five days for the delivery of the documents. Using the Voltron blockchain platform, all parties involved were able to view the progress of the transaction in real time, which reduced the time needed to complete it. By using blockchain technology, the transaction was completed in less than 12 hours. Supasachi Hongsinlark, Managing Director at PTT, commented:
“The system will provide more visibility to monitor trade finance flow in real time, which will improve transparency and credibility for the trading process and thus strengthen the relationship between our partners and stakeholders in the long run.”
Earlier this month, Standard Chartered also completed its first joint blockchain-based supply chain financing transaction. The transaction was made in partnership with China-based supply chain financing service provider Linklogis.