London headquartered, HSBC Holdings has reportedly announced the completion of first yuan-denominated blockchain letter of credit transaction here on Tuesday.
Apparently, the investment company HSBC, has been progressively looking to utilize digital ledger technology, or blockchain, in order to rationalize the conventional paper-based and administrative business of the financing trade.
It has been claimed that as the first such transaction to use the Chinese yuan, the agreement takes a step forward in the use of the Voltron trade finance platform, which has been developed by the several banks including BNP Paribas, Standard Chartered, and also HSBC.
Till today, the transactions utilizing the Voltron platform have principally been individual pilot cases. The company’s provincial head of global trade & receivables finance for APAC region, Ajay Sharma reportedly claimed that advancement was being made toward a full recommendation, and what could be an industrially acceptable model for the banks.
Moreover, the multinational investment bank is looking forward for some progress by the year end or in the first quarter of the next year relating the platform. Additionally, the company is enforcing its hopes on the technology which would lessen down the unit cost of the transaction along with providing other benefits.
As per the statements by the investment company, over 1.2 million letters of credit, documents supplied by a bank assuring a buyer’s payment to a vendor valued at USD 750 billion, were issued into and out of China in 2018.
Meanwhile, this addressed deal included Hong Kong-based MTC Electronic delivering out a shipment of LCD parts and boards to its parent organization, Shenzhen MTC, based over the fringe from Hong Kong.
As per trusted sources, the exchange of the electronic documents had been successfully concluded in 24 hours in comparison to the typical five to 10 days required for conventional document exchange.