HSBC, ING Conduct Blockchain-based Transaction For Reliance Industries
Asia-focused lender HSBC’s Indian unit joined with ING Bank Brussels to execute a trade finance transaction with India’s Reliance Industries using blockchain technology.
In the transaction, the first of its kind in India, the US-based Tricon Energy made a cross border payment to Reliance through blockchain, cutting costs and time significantly.
A shipment between Reliance Industries and Tricon Energy, USA was facilitated by the blockchain-enabled Letter of Credit transaction.
According to Srikanth Venkatachari, Joint Chief Financial Officer, Reliance Industries, blockchain holds significant potential to reduce the time involved in exchange of export documentation to less than a day from the current seven to 10 days.
Buyers and sellers at present use paper-based LCs to complete deals, which have to be sent to each party by post, courier or fax that is time consuming and increases costs. HSBC noted that the latest transaction validates the commercial and operational viability of blockchain as an alternative to conventional documentation.
It was reported that the end-to-end transaction was executed on R3’s Corda blockchain platform.
Enterprise blockchain software firm R3 has teamed with HSBC, ING and six other banks including BNP Paribas, SEB and Standard Chartered for the Corda blockchain platform. The companies plan to expand the network on an open source basis to drive adoption across the financial industry.
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