Hong Kong’s central bank will launch its own blockchain-based trade finance solution, in conjunction with 21 other banks, according to sources. This joint initiative of the Hong Kong Monetary Authority and the FinTech subsidiary of the China Ping Ang Group; OneConnect; aims to significantly reduce paperwork, time and expenses in many of the operations carried out by the banks. One of the principal points of interest for this 21-institution consortium is to reduce the time and bureaucracy involved in the registration of new businesses in the banking services industry by “smoothing” transactions taking advantage of the applications of blockchain technology. By using blockchain, some transactions, that often take up to 14 days to be completed, would be processed in only one day.
Originally announced last year in November, this would represent the first example of a regulatory entity “unifying banks” to improve trades finance, even though HSBC would have previously tried to do so with a single bank as we previously reported.
“Instead of banks trying to do this individually, you have the regulators trying to unify the banks,”
said Jessica Tan, CEO of Ping Ang Group, a company that would have previously developed blockchain-based solutions for the Chinese market, and points to extend itself beyond China’s borders, after announcing its interest in developing more solutions for the R3 Consortium in 2016.
by Samuel Larreal