Credit Suisse Tests Financing Through eNote

Credit Suisse says it has provided financing to two manufacturing companies using an electronic promissory note, or eNote.

The Swiss financial services firm announced the completion of this pilot transaction Tuesday (Jan. 11), saying the technology — built by the Zurich-based FinTech FQX — had provided financing to a pair of Swiss companies, SFS and Mikron.

“The eNote is a blockchain-based short-term debt instrument with which corporates like SFS and Mikron can radically facilitate their corporate treasury operations while increasing financial steering flexibility,” the companies said in a news release.

SFS provides mechanic fastening systems, assemblies, precision components and logistics solutions, while Mikron makes automation solutions, cutting tools and machining systems.

“An eNote is an unconditional promise to pay a specific sum to another party at a specific future date,” FQX says on its website. “The eNote is based on Blockchain technology and can be flexibly sold and transferred to any third party (i.e. an investor).”

The company claims eNotes outperform other financing options as negotiable instruments “through their financial steering capabilities and global transferability,” and are based on “the globally proven, formerly paper-based ‘promissory notes.’”

Read more: Deep Dive: How The COVID-19 Pandemic Is Moving SMB Lending, Disbursements Away From Paper Checks

PYMNTS examined the move away from paper-based lending for small businesses in the early months of the COVID-19 pandemic.

Our research found that a lot of FinTechs were using tools like artificial intelligence (AI), machine learning (ML), automated tools and digital channels to speed up processes that had usually been paper-based.

At the same time, there were still many traditional lenders who relied on on paper-based or outdated digital underwriting processes for to approve payments. This caused SMBs’ financial headaches to worsen, as even those businesses who get loans may have to wait weeks to funnel that money to partners or employees.