**First fully-digitised trade transaction in Singapore using an electronic Bill of Lading**
**Deal marks the next step in blockchain’s transformation of trade finance**
BNP Paribas and HSBC Singapore have successfully completed Singapore’s first fully digitised end-to-end letter of credit transaction between two different companies – a move that will take the digitisation of trade finance a step closer to becoming a commercial reality.
The transaction involved Rio Tinto selling a bulk shipment of iron ore originating from Australia to China for its customer Cargill. As part of the transaction, BNP Paribas issued a Letter of Credit (LC) over the blockchain on behalf of Cargill to HSBC Singapore acting on behalf of Rio Tinto.
Both BNP Paribas and HSBC enabled a seamless end-to-end transfer of electronic Bill of Lading (eBL) over traded goods using a digital LC for the first time in Singapore, by integrating the Voltron trade finance solution (through R3’s Corda blockchain platform in the back-end) with Bolero’s eBL system.
Zoran Lozevski, Head of Global Trade Solutions, Asia Pacific, BNP Paribas said: “The future of trade finance is digital and paperless, and BNP Paribas is pleased to be at the forefront of changes that will make facilitating trade even easier for our clients. Blockchain technology is an important pillar in our innovation agenda and we believe that transactions like this one will help achieve greater efficiency and transparency in trade finance for the benefit of all players in this space.”
Iain Morrison, HSBC Singapore Head of Global Trade and Receivables said: “The transaction represents a significant advancement of this solution since our first transaction earlier this year, which further validates its commercial and operational viability to establish a new era of digital trade. Together with banks and the trade finance industry we will continue to improve this solution by adding new features and functionality as we move towards a commercial launch.”
Rio Tinto Head of Commercial Treasury, Abel Martins-Alexandre said: “Blockchain offers efficiencies and greater transparency, while also creating a viable new offering to our customers and stakeholders along the supply chain. This pioneering transaction demonstrated our commitment to partnering with our customers to meet their needs, to stay agile and responsive to opportunities for improving efficiencies, and make our respective businesses stronger.”
Lee Kirk, Managing Director for Cargill’s Metals business: “As the first fully-digitised iron ore transaction in Singapore, this marks a positive and exciting new development for the ferrous industry. What was previously a complex process is now accessible via a more modern, digitally-based approach and a secure platform. At Cargill, we are transforming our supply chains with digital technologies like blockchain in trade finance, commodity trade operations and traceable food programs to better serve our customers across the globe.”
Note to Editors
About Voltron and Corda
Earlier this year, eight banks, including BNP Paribas and HSBC, entered into a partnership with Bain, CryptoBLK and R3 to launch an open platform on Corda blockchain for documentary trade. Voltron’s initial aim is to use blockchain technology to bring significant efficiencies to transacting letters of credit. Attracting more technology partners to help bring more importers, exporters and banks into the network will boost Voltron’s effectiveness.