Standard Chartered and Siemens to pilot blockchain-based smart guarantees
According to Standard Chartered, this is an “industry-first client pilot” and will remove the “traditionally paper intensive” nature of the business. It will digitise the process, from initiation of the bank guarantee to the claim handling.
Standard Chartered explains that unlike a letter of credit which involves multiple parties, performance details and over 100 pages of documents, a commercial bank guarantee is a “much simpler instrument” to digitise.
This solution will enable Siemens to digitise its guarantee process for customers with large transaction volumes in the future, spanning issuance, amendments and claims.
The pilot started in March 2018 and will be completed later this year.
The solution is based on auto-executing smart contracts, using R3’s Corda distributed ledger and application layer provided by TradeIX.
Away from this latest development, both Standard Chartered and TradeIX have been active in other blockchain projects.
The bank has been up to a lot. One recent example is from July, when a group of Hong Kong banks – including Standard Chartered – set up a trade finance blockchain platform. The goal is to digitise documents and automate processes.
Earlier this month, DNB completed testing of the first release of the TradeIX Trade Finance platform as part of the Marco Polo blockchain initiative.