British investment bank HSBC and agrichemical company Syngenta have completed the transaction of a digital letter of credit using TradeLens’ blockchain-supported digital bill of lading.
As TradeLens said in news release Thursday (Feb. 3), the entirely paperless transaction helped expedite trade documents from South Korea to Bangladesh for an agrichemical product shipment between the two countries.
“This milestone demonstrates an important step in modernizing trade finance and supply chain efficiency across the global trade ecosystem,” TradeLens said in the release.
“Electronic bills of lading have been considered the holy grail of shipping documentation — incredibly valuable but out of reach, until now. Today only 0.1% of original bills of lading are digitized, but with an end-to-end SaaS solution via TradeLens now available for Trade Finance transactions, original bills can move to paperless processes for all involved.”
TradeLens was developed by IBM and Danish shipping giant Maersk in 2018 to bring a blockchain-based solution to the global supply chain.
Read more: New Maersk Acquisition is Latest Move in Creating More Resilient Supply Chain Ecosystems
In its latest project, TradeLens says all documentation associated with the shipment was shared among parties using the TradeLens platform.
This included the electronic bill of lading, commercial invoice, packing list and certificates of origin and analysis, as well as the bank collection documents, “all underpinned by blockchain and visible to permissioned parties as soon as they were uploaded to the platform.”
As a result, Syngenta saw an estimated savings of 10 days in document processing lead times, and substantially improved on their “speed to customer,” TradeLens said.
“Trade between proximate markets is often encumbered by paperwork, leading to delays and higher costs,” Sanjay Tandon, HSBC’s regional head of product management, global trade and receivables finance for Asia Pacific, said in the release.
“Removing paper from the process should not only increase the efficiency and velocity of trade, but also enhance the appeal of the letter of credit as a trade finance solution by minimizing documentary complexity,” Tandon said.
We’re always on the lookout for opportunities to partner with innovators and disruptors.
Learn More