HSBC Becomes the First Bank to Finance Transaction via Hyperledger
Multinational banking giant, HSBC has reportedly become the first bank to complete a financial transaction using the blockchain trade platform, we.trade based in Europe.
We.trade, Based in Dublin, is a Hyperledger Fabric-powered solution for managing, tracking and protecting open account trade transactions between SMEs (small-to-medium enterprise) in Europe.
This is a significant step forward as a Multinational Banking giant puts blockchain into live demonstration.
According to an HSBC spokesperson, the bank has yet to commercialize the platform and its clients are currently using it “at zero cost”.
In other projects, HSBC has also collaborated with Landmark Group, a Middle Eastern retailer, to connect two blockchain platforms for the first time for the bulk shipment.
HSBC's trade finance blockchain, Voltron, integrated with Landmark Group’s platform ReChainME to enable all parties to access real-time data. This connection reduced transaction time by up to 12 days (40%).
HSBC also stated:
“Having the two platforms seamlessly connected meant all parties in the supply chain ecosystem were able to track and view the progress of the transaction, agree on the terms of the transaction including logistics, co-create and approve documents and fast track supplier payments, all in real time.”
Vivek Ramachandran, HSBC’s Head of Growth and Innovation states:
“The need for paper reconciliation is removed because all parties are linked on the platform and updates are instantaneous,”
“The quick turnaround could mean unlocking liquidity for businesses.”
In 2018, HSBC’s Blockchain Platform processed $250 billion in forex.
It reports 25% savings in forex trade settlement using blockchain.
Mark Williamson — chief operating officer of forex cash trading and risk management at HSBC states; “The more participants that you have joining the HSBC shared permissioned ledger and the ecosystem, the more efficient we’re going to become in providing services to our clients.”
Other banks have their sights on blockchain technology as well.
In a Reuters article, Several of the world’s largest banks are in the process of investing around $50 million to create a digital cash system using blockchain technology to settle financial transactions.
The significance is clear, and the way financial business is being done is changing.
Blockchain is emerging as the leader in that change.