Lloyds Bank, a British retail and commercial bank established in 1765, has joined forces with Komgo, a company that claims to be focused on catalyzing the global commodity trade finance network using the Ethereum smart contract block chain. The agreement will allow Lloyds Bank to integrate distributed accounting technology ( DLT ) into its commercial financing operations, reports FStech on September 25, 2019.
Lloyds Banks Taps Blockchain
In an attempt to facilitate commodity trade finance transactions and faster letters of credit, Lloyd’s Bank has forgedan alliance with Komgo to take advantage of the strong blockchain technology infrastructure of the latter.
According to sources close to the issue, Komgo’s platform is driven by the Enterprise Ethereum block chain, allowing the digitization of the entire commodity trade financing process, while allowing companies to exchange data and other documents, including letters of credit, quickly and without friction, decentralised and secure way.
According to reports, in addition to using Komgo’s block chain solution to speed up business transactions and letters of credit, Lloyd’s Bank will also be able to significantly curb fraudulent activities, as the bank and its partners will now be able to monitor transactions inreal time .
Reducing paperwork and third parties
While financing international trade has numerous risks and associated bottlenecks, the issue of efficiency time, endless paperwork and unnecessary third-party participation are some of the most critical challenges affecting market participants.
al comment on theLloyds DLT integration, Gwynne Master, managing director and head of global trade at Lloyds Bank Commercial Banking reiterated that blockchain technology will potentially reduce some of the weak points in trade finance. Shifu said:
“ Incomplete and ‘time consuming’ are just two words used to describe current international trade. It takes more than 100 days to exchange a single product and the process involves many players, as well as great paperwork and risk. Trade is particularly expensive for our commodity customers, where faster response times and a streamlined channel are essential requirements.”
Master added that the new alliance with Komgo will be responsible for digitizing and rationalizing the trade financing process and will help corporate customers shorten the time needed to complete international exchanges.
“ We are moving towards a new era of simpler and more inclusive access to DLT, which has the potential to supportStrong and collaborative business relationships. Partnerships like this and underlying blockchain technology will help eliminate the challenges our customers face.”
In related news, in early September 2019, BTCManager reported that HSBC bank had successfully executed its first blockchain-based credit letter.
