This involves the participation of the central bank and seven other lenders.
Reuters reports that the Hong Kong Monetary Authority (HKMA) and seven other banks announced that they will jointly roll out a blockchain-powered trade finance platform in September.
Also read: Here are Asia's top trade finance banks
The participating banks include HSBC Holdings PLC, Standard Chartered PLC, BOC Hong Kong Holdings Ltd, Hang Seng Bank Ltd, Bank of East Asia Ltd, Australia and New Zealand Banking Group Ltd and DBS Group Holdings Ltd whilst the technology will be provided by Ping An Insurance Group Co of China Ltd.
Leveraging on blockchain can significantly improve processing time and reduce cost as documents will be digitised and much of the manual process is automated, in effect boosting the financing capability of the banking industry. This can meet around $1.15t unmet demand for trade finance globally.
"The next major milestone ... is to link up with other trade platforms in other jurisdictions to further facilitate cross-border trades," HKMA deputy chief executive Howard Lee said in a joint statement with the participating firms.
Global trade flows are increasingly shifting its centre to Asia with the median transaction volume reported in APAC hitting a total value of $2.15t which is nearly double the level processed in North America, and about 10 times the median volume in Africa.
“Asia-Pacific is still in a pole position: as an anchor for large portions of trade financing globally, which reflects the fact that major global supply chains and trade corridors are anchored or linked to the region,” the International Chamber of Commerce noted in an earlier report.
Several Asian countries have responded to this massive opportunity and rolled out similar technology powered platforms to boost trade activity. India launched a blockchain-powerd trade finance network last May called India Trade Connect with the participation of Axis Bank, ICICI Bank, IndusInd Bank, Kotak Mahindra Bank, RBL Bank, South Indian Bank, and Yes Bank.
A total of 14 banks from Thailand also linked up to create the Thailand Blockchain Community Initiative last May to develop a shared trade finance platform.
Here’s more from Reuters:
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