Seven banks in India have struck an agreement to collaborate with digital banking service provider Infosys Finacle on a blockchain-powered trade network, the company announced Wednesday (May 16).
In a press release, Infosys Finacle said it has successfully launched India Trade Connect, a trade network developed with Axis Bank, ICICI Bank, Induslnd Bank, Kotak Mahindra Bank, RBL Bank, South India Bank and Yes Bank. Together, the entities have formed a network to pilot Finacle Trade Connect, the firm’s trade finance process management tool for lenders.
Infosys Finacle first announced its blockchain trade finance solution for banks last year after 11 banks participated in trials.
The company said it aims to increase transparency and risk mitigation with its technology to facilitate trade finance processes for banks and ease access to capital for borrowers. This includes ownership validation, document certification and payments.
Bill collection, letters of credit, account opening, purchase order financing and invoice financing are also all integrated into the Trade Connect Platform. Lenders gain greater visibility into the status of a bill and risk exposure of corporate trading partners, while blockchain technology supports the digitization of trade documents without reduced security, noted Infosys Finacle.
“Blockchain technology offers unprecedented opportunities to transform banking,” said the company’s chief business officer Sanat Rao in a statement. “Like any innovative technology, the usage of blockchain-based applications will gradually increase from early adopters to others who will join based on proven and tangible benefits.”
In another statement, Axis Bank EVP & head of transaction banking Anil Agarwal said trade finance is just beginning to embrace innovations. “We are excited about the potential of India Trade Connect initiative to digitize end-to-end trade finance operations and bring about a speedy, transparent and secure experience for our corporate clients.”
“With more organizations adopting the blockchain technology, it holds immense potential to offer a seamless network for all stakeholders on a single platform,” added ICICI Bank senior general manager Ajay Gupta. “Going forward, we intend to collaborate with peer banks and other partners and create a comprehensive blockchain ecosystem, thereby contributing towards greater adoption of this technology.”