Financial institutions will be able to automate pre- and post-shipment financing and risk mitigation for corporate buyers and sellers around the world

Financial institutions will be able to automate pre- and post-shipment financing and risk mitigation for corporate buyers and sellers around the world

Enterprise software firm R3 and trade finance specialist TradeIX are developing an end-to-end open account trade finance business network which will be powered by TradeIX and R3’s Corda distributed ledger platform.

The initiative is a joint undertaking between the duo, and 12 financial institutions including Bangkok Bank, Barclays, BBVA, Bladex, BNP Paribas, Commerzbank, CTBC Bank, ING, Intesa Sanpaolo, Shinhan Bank, Royal Bank of Scotland and Wells Fargo.

Rob Barnes, CEO of TradeIX, says the network “provides the entire trade ecosystem with a smarter, more secure, and more transparent infrastructure that connects currently siloed parties and systems, standardises and digitises trade documents, data and assets”.

Financial institutions will be able to automate pre- and post-shipment financing and risk mitigation for corporate buyers and sellers around the world. In turn, corporate buyers and sellers gain access to API-driven solutions. This infrastructure is designed to integrate with existing platforms as well as R3 and other ecosystems.

The initial development phase involves creating standard trade finance smart contracts on a distributed ledger infrastructure.

Following this phase, R3 and TradeIX don’t offer specifics but say they will “engage the broader ecosystem, expanding services and onboarding additional members”.

R3 also announced that the International Trade and Forfaiting Association (ITFA) is joining the R3 network and will be involved in this project and others. ITFA is a global association for the trade receivables and supply chain finance industry with over 170 members.

Bustle and tussle

R3 has been up to other stuff this month.

Along with the UK’s Financial Conduct Authority (FCA), RBS and another unnamed bank, they have built a prototype application for regulatory reporting of mortgage transactions on Corda.

On a less happy note, R3 and Ripple are suing each other over an options contract to purchase Ripple’s digital currency XRP.

@banking
techno