Citi is signing on to Contour’s blockchain-driven trade finance network, Contour announced in a press release on Sunday (Feb. 16). The bank joins numerous banking giants on the Singapore-based network (including HSBC, Standard Chartered and Bangkok Bank), and made an investment in Contour through Citi Ventures. The industry wide global collaboration effort is looking to revolutionize the trade finance network.
“Seeing greater collaboration from leading financial institutions shows how important revolutionizing the trade finance network is. With international trade being of such significant importance for the global economy, with trillions of dollars’ worth of goods in circulation, proper financing is vital for its continued growth,” said Carl Wegner, CEO of Contour. “Our network provides trusted information in real time, digitizing the process for all users. To have a major global trade player such as Citi join us is a huge validation of the work we are doing, and allows us to continue creating greater efficiency for the industry.”
The network is currently in the beta phase, but Contour — established in Singapore by FinTech consortium R3 — is moving into full commercialization after two years of successful pilots in 14 countries. The Corda blockchain trading venture rebranded last month from Voltron, and is back by seven of the eight founding bank members of Voltron: Bangkok Bank, BNP Paribas, CTBC, HSBC, ING, Standard Chartered and SEB.
Contour’s network focuses on improving the Letters of Credit (LoC) process. Traditionally paper-based, Contour digitizes LoCs to help banks and corporates operate efficiently and transparently.
“The Contour team has a trusted background, and is partnering with a strong consortium to help digitize Letters of Credit. Citi Ventures is thrilled to support Contour as it pursues its exciting vision,” said Luis Valdich, managing director of Citi Ventures.
Trade finance remains an essential tool for cross-border B2B trade. With an estimated $1.5 trillion gap in available trade finance, non-bank players have flooded the market to address the demand — and introduce efficiencies to an area of finance that has historically been bogged down by paper, manual processes and burdensome compliance requirements.