- HSBC Bangladesh completes pioneer international transaction using a blockchain platform
- CEO of HSBC Bangladesh hails transaction for being swift, secured and transparent
Hongkong and Shanghai Banking Corporation Limited (HSBC), a leading global bank has just completed an international transaction it performed on a blockchain platform. The financial institution used the platform to issue a Letter of Credit (LC) to a firm in Singapore. This transaction was carried out by HSBC Bangladesh.
Contour, a blockchain platform owned by HSBC and eight others was used to carry out the transaction.
HSBC Bangladesh made use of the LC to make payment for over 15,000 tonnes of fuel oil that was imported via United Mymensingh Power. The company is a subsidiary of Singapore’s United Group.
In a statement released by the Chief Executive of the HBSC Bangladesh, Md Mahbub ur Rahman, he hailed the transaction as a pacesetter and a welcome development in the financial industry. He added that this pioneer trade shows the level of commitment the HSBC bank has in using technology to make their transactions faster and secured.
He also went on to highlight that blockchain-based transactions would unlock a new level of transactions between different countries and businesses. He further added that this pioneer blockchain-based trade has shown that subsequent transactions would be faster, secured and transparent which would inevitably aid the growth of the sector.
According to SWIFT, deals valued at over $34 billion were completed in the Asian country using LCs. This level of trade was recorded in the first half of the year.
Previous transactions had usually taken a week or two for it to be completed, but the introduction of the blockchain technology into the system has lessened the period to less than a day.
Contour is owned by HSBC and seven others
The blockchain platform used in completing the transaction, Contour, was developed through an agreement between eight banks. The banks are the Standard Chartered Bank, Citi Bank, Bangkok Bank. While others are BNP Paribas, CTBC Bank, SEB, ING and HSBC.
This platform was developed three years ago. It was hitherto called “Voltron.” Contour is built on R3’s Corda and helps to create a link between financial organizations and other corporate institutions via a decentralized finance network.