Over 250 Firms Test Blockchain Platform by Indian ICICI Bank

The platform will enable trade finance transactions.

by Kalina Tekelieva
19 April • 3 min
In News

Indian ICICI Bank has successfully engaged more than 250 companies to test its blockchain platform for domestic and international trade finance, the bank said in a press release on Tuesday.

Among the participants in the test are Indian companies from the S&P BSE 100 Index (BSE100) of the largest and most liquid listed companies.

The companies have carried out different types of trade finance transactions through ICICI’s blockchain application, including cross-border remittance for salary payments, domestic vendor payments across cities and payments for raw materials to domestic partners.

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The project is part of ICICI’s efforts to explore the application of blockchain technology in the banking sector. The Mumbai-headquartered bank piloted the blockchain-based transactions in international trade finance and remittance in collaboration with Dubai-based banking group Emirates NBD in 2016

Blockchain and banking

 

In its statement released on Tuesday, ICICI commented that “blockchain technology simplifies the paper-intensive trade finance process by bringing counterparties on the same platform, enabling decision making in almost real time.”, Physically sending paper documents across cities or countries is also not required with the technology and neither is verification through trade intermediaries.

ICICI underlined in a press release from October 2016 that blockchain has the potential to simplify and shorten remittance and trade finance processes which typically take a few days to just a few minutes.


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Other industry players have also made steps to introduce blockchain tech in trade finance. In February, US software startup R3 and UK trade finance tech firm TradeIX launched the trade finance platform Marco Polo. In addition to trade finance, blockchain has been adopted by banks for other banking purposes. Spain-based bank Santander launched last week a Ripple-based service which will enable customers to execute fast and secure international payments.

Bank of England (BoE) announced at the end of March it will test blockchain features for its updated real time gross settlement (RTGS) service, which allows banks to transfer funds in real time and on a gross basis.

ICICI’s future plans

In its latest announcement, ICICI disclosed it is eyeing a further initiative in the blockchain sphere. This time, ICICI will co-create a blockchain-based trade finance system in collaboration with other banks. The consortium will, according to the plan, provide a digitized end-to-end trade solution to various trade market participants, such as buyers, sellers, logistics partners and insurance companies.