By Staff Writer
Standard Chartered announced the successful completion of the first cross-bank Letter of Credit (LC) transaction between Vietnam and Thailand conducted over blockchain, in partnership with Asian Development Bank (ADB), Bank for Investment and Development of Vietnam and Standard Chartered Bank (Thai), according to a statement.
The transaction was completed over the Contour network, a blockchain-based open industry platform focused on digitising trade finance, and involved a US$50,000 shipment of plastics from Thailand’s SCG Plastics Co., Ltd. to Vietnam’s Opec Plastics Joint Stock Company. Compared to the paper-intensive and time-consuming processes involved in the traditional methods of trade finance, by digitising the end to end exchange of information and streamlining the process of LC issuance and confirmation, all trade participants achieved a significant reduction in processing time from up to five days to within seven hours.
It also marks the successful completion of ADB’s first credit guarantee using distributed ledger technology, as well as the first of such LC comprising a sell-down feature to be conducted on Contour. The transaction further paves the way for more banks and corporates to collaborate on innovative technology that can support the growth of trade, having demonstrated the ability to complete the trade sell-down process with greater speed and efficiency.