Facilitates automation of trade processes, enhances the service quality of cross-border trade and the efficiency of trade finance for corporations.
Bank of China (Hong Kong) (“BOCHK”), in collaboration with Bank of China Guangdong Provincial Branch and Shenzhen City Branch, has completed the first batch of blockchain-based cross-border trade transactions and one of the first trade finance transaction upon the connection of Hong Kong’s innovative trade finance platform eTradeConnect and the Mainland’s Trade Finance Platform.
The connection facilitates the automation of trade processes, enhances the service quality of cross-border trade and the efficiency of trade finance for corporations. It also helps corporations reduce transaction and management costs and promotes economic and trade exchange between Hong Kong and the Mainland.
BOCHK is committed to the application of blockchain technology in financial services, including cross-border trade transactions, to enable customers to create and transfer complete and encrypted transaction information on blockchain-based platforms, as well as strengthening the traceability of such information.
The connection of the two platforms will enhance the transparency of cross-border transactions, and ensure the authenticity and validity of paper documents, thereby facilitating secure information exchange and the streamlining of trade processes. BOCHK also provides support to its corporate customers that apply for trade finance online by facilitating real time online transmission and the automated processing of transaction documents such as purchase orders and electronic invoices through the shared ledger and smart contract technology.
The Proof-ofConcept (PoC) trial that connects eTradeConnect and the PBoC Trade Finance Platform aims to provide importers and exporters in both places with more convenient trade finance services. As blockchain technology becomes increasingly mature, there is a significant surge in the market demand for the application of blockchain.
The immutable and traceable nature of the technology has a positive impact on cross-border trade and plays an important role in driving the digital transformation of the supply chain system.
BOCHK is one of the initiating banks of eTradeConnect and has been an active participant on both eTradeConnect and Trade Finance Platform.
eTradeConnect is one of the first large-scale cross bank blockchain project in Hong Kong, managed by the Hong Kong Trade Finance Platform Company Limited, a subsidiary of Hong Kong Interbank Clearing Limited.
On this distributed ledger technology (DLT)-based platform, customers and their trading partners can conduct trade and trade financing activities through sharing of information in an effective and cost-efficient way. Trade Finance Platform is managed by a subsidiary of the People’s Bank of China’s Institute of Digital Currency.
The platform is a financial infrastructure that provides public services in trade finance. Since launch, the platform has facilitated several businesses including multilevel receivable financing in the supply chain, cross-border financing, international trade remittance supervision, and tax reporting on outward payments.