Singapore-based multinational bank DBS and energy company Trafigura have joined forces with several other industry leaders to launch a blockchain trading platform in Singapore that reduces document transit time by days.
DBS Bank and Swiss commodities trading company Trafigura have collaborated with the International Chamber of Commerce (ICC), Infocomm Media Development Authority (IMDA) and Enterprise Singapore and trade tech Perlin to design an open-source blockchain trading platform that will drastically reduce trade document transit time from forty-five days to twenty days and automate the otherwise tedious paper-based trade processes.
The platform’s maiden trade run will be carried out from Africa to China on 6th November 2019 and carry around twenty million US dollars ($20 million) worth of iron ore.
Blockchain trading platform to streamline trade logistics
The ingenious ICC TradeFlow platform is designed using IMDA’s TradeTrust network infrastructure and based on Perlin’s blockchain technology. Reportedly, it will streamline trade between digitized harbors like Singapore and countries that follow traditional paper-based trading practices.
All stakeholders on the blockchain network will be able to send, receive, and monitor trade instructions live, thereby decreasing the end-to-end document transit time by half.
Tan Su Shan, who is heading the institutional banking services at DBS, confirmed the news by saying that the goal is to exploit each others’ expertise and knowledge in commodities trading and finance and utilize it to serve our customers in a faster and more efficient way.
With each passing day, the platform will be assessed for further improvements, and more enhancements will be made in terms of background information, credit ratings of trade participants, vessels, and couriers to build trust among stakeholders, DBS confirmed.
The platform will not only reduce inefficiencies and complexities arising due to paper-based cross-border trading practices but also cut down operating costs for companies, risks of fraud, and errors in documentation.
Meanwhile, this isn’t the firm time Singapore has entrusted its trade logistics to blockchain technology. Last month, the Singapore Shipping Association embraced the technology to simplify ship registration and renewal procedures. At the same time, Thailand used IBM’s TradeLens blockchain solutions to bring about drastic transformation in its shipping industry by offering tamper-resistance efficient workflow systems.