HSBC Carries Out Bangladesh’s First Blockchain Letter-of-Credit Transaction

HSBC Bangladesh has completed the country’s first blockchain-powered cross-border trade settled using a letter of credit. The Bangladesh branch of global banking firm HSBC has conducted the country’s first blockchain-based letter of credit (LC) transaction on the Contour DLT platform.The transaction was used to settle the importation of 20,000 tonnes of fuel oil from United Group’s Singapore subsidiary United Mymensingh Power.HSBC Bangaladesh’s chief executive, Md Mahbub ur Rahman, described the transaction as showcasing the bank’s commitment ”to supporting cross-border trade using....

Banking giants Bank of America and HSBC have teamed up with the Singapore government’s IT and telecom agency on a project that applies blockchain to trade finance. Announced today, Bank of America, HSBC and the Infocomm Development Authority of Singapore (IDA) revealed they have built a blockchain application based on the Hyperledger protocol that aims to replicate the letter of credit (LC) transaction process between banks, exporters and importers. The trial finds the financial firms seeking to explore how a distributed ledger could establish trust between parties that today need to rely....

Trade finance is entrenched in paper documents these days, as it had been for decades. Using smart contracts on top of blockchain technology could address most of the market inefficiencies. These are exciting times for blockchain technology. Barclays, a world-renowned bank, and Wave, one of their accelerator graduates, conducted a live test of distributed ledger technology. A Live Letter of Credit transaction was performed and completed.This is a significant validation of blockchain technology. Wave is a company dedicated to bringing distributed ledgers to the financial sector. Ever since....

PJSC Siberia Airlines, commonly known under its operative name of S7 airlines has executed the first of its kind service payment using Ethereum blockchain smart-contracts through a letter of credit, with Russia-based Alfa-Bank. The announcement reveals that the agreement took place between the airlines and a counterpart using a letter of credit, through Alfa-Bank. A letter of credit is issued as a bank guarantee that payments will be made to a seller from the buyer. The bank issuing the letter of credit is obligated to cover the amount in the event that a buyer is unable to make the....

HSBC and its partner, Bank of America’s Merrill Lynch, recently published a proof of concept to demonstrate how Blockchain-powered contracts can be used to replace paper letters of credit which are commonly used in international trade. R3 Consortium, on the other hand, completed two prototypes which demonstrate how distributed ledger technology can address the key challenges facing the USD 45 billion global trade finance industry. However, in separate interviews, when officials of both institutions spoke about the Blockchain technology, the key concept which permeated their conversations....