Banking and financial services firm HSBC says its blockchain-based trade finance solution is ready to launch — in pilot phase, at least.
According to Wednesday (Feb. 28) reports by the Global Trade Review, the bank's senior innovation manager, Joshua Kroeker, held a media call and announced that after developing the trade finance solution for about two years, HSBC is “confident enough to actually do a live transaction” using its blockchain technology.
“Going from that PoC in 2016, we're at the tipping point of getting our customers involved in live transactions in the coming weeks and months,” Kroeker said. “The technology has come a long way. We're much more comfortable with its security and scalability.”
He added that HSBC will now look for partners to test the solution, then move forward into production for an actual release. In addition, Kroeker highlighted HSBC's focus on documentary credit as a key area that can be improved using technologies like blockchain.
“For the most part, [our trading clients] have worked very hard to streamline and digitize their operations where possible, but the product that gives them the most trouble is the documentary credit,” he said. “This product is one of the first we're going to pilot, which is going to be exciting.”
Throughout 2018 and 2019, HSBC will be focusing on further developing a platform and network for the trade finance solution. This involves working with regulators, other financial institutions (FIs) and customs players, and onboarding them to the tool to ensure entire trade finance processes can be completed through blockchain.
Last year, HSBC was among several global banks to announce a partnership with IBM, using the technology giant's solutions to develop its blockchain platforms for trade finance. Together, IBM and the FIs formed the Digital Trade Chain Consortium. HSBC also formed its technology advisory board in 2017, a panel which includes former Ripple CEO Chris Larsen.