A consortium of technology firms and banks operating under the name Marco Polo is piloting a trade finance solution based on distributed ledger technology after a successful proof-of-concept.
Trade finance technology specialist TradeIX and enterprise software firm R3 have been working with core banks BNP, Commerzbank and ING since September last year and, since then, have been joined by Standard Chartered, DNB of Norway, and Finland’s OP Financial Group.
The Marco Polo initiative has developed a post-shipment trade finance solution powered by TradeIX’s TiX platform and R3’s Corda blockchain technology. It makes possible end-to-end, real-time, seamless connectivity between trade participants, eliminating data silos which prevent free flow of information thereby reducing inefficiencies and discrepancies.
The initial focus is on risk mitigation based on the matching of trade data, payables finance, and receivables finance.
“The tests ING ran as part of the proof-of-concept enabled us to see the value this solution could deliver in three separate areas of trade financing. The technology ran fast and smoothly and the positive results showed us we are on the right track and ready to take the next step by entering into a pilot,” said Ivar Wiersma, head of innovation at ING Wholesale Banking.
Microsoft’s cloud is part of the foundation of Marco Polo. Connie Leung, senior director, financial services business lead Asia, Microsoft, said: “Heavy paper processing across complex supply chain processes are a significant burden to businesses. The industry has been looking for solutions to simplify and digitise trade, making supply chain ripe for the benefits of blockchain technology.”