As of June 17th, 2021, it has been reported that a consortium of 15 Indian Banks has set up an efficient & much-required blockchain trade finance consortium. Known as the Indian Banks’ Blockchain Infrastructure Co (IBBIC), it is initially focused on domestic Letters of Credit.
The involved banking team consists of some of the largest banks of India such as State Bank of India, ICICI, and HDFC Bank, as well as Standard Chartered.
The blockchain-backed trade finance network, IBBIC concentrates on reducing the processing time for transactions from 4-5 days to a matter of hours as well as is efficient enough to mitigate the quantity of the paperwork given, Letters of Credits are very paper-intensive. Apart from this, another major threat being faced by the trade finance industry is the possibility of fraud, especially while submitting paperwork to a variety of lenders to raise more than the shipment value. With the help of this blockchain trade finance network, it would likely be way complex to raise multiple letters of credit for the shipment of the same goods.
This advanced letter of credit solution is elevating 50 million rupees ($680,000) from each bank for a total of $10.2 million funding and it will consider the Infosys Finacle Connect solution. It's anticipated to be launched later this year.
