Singapore-based DBS Bank announced the launch of its multi-tier trade finance service on the blockchain platform ‘Rong-E Lian’ in a bid to make trade financing more accessible for Chinese small and medium-sized enterprises (SMEs), as reported by Singaporean local news outlet The Straits Times.
According to DBS, such a system makes it possible to provide trade financing within one day, whereas conventional paper-based methods would have taken weeks or even months.
Developed in partnership with an unnamed leading Chinese logistics provider (believed to be SF Group), Rong-E Lian offers multi-tier financing solutions to over 1,000 of suppliers in the company’s supply chain ecosystem.
The multi-tier financing solution is especially beneficial to suppliers embedded beyond the first layer of the logistics supply chain ecosystem, as they include SMEs with limited access to trade financing due to their lack of scale or credit history.
Leveraging DBS’ Application Programming Interface (API), the bank has integrated its digital onboarding service into the blockchain platform so that the credentials of a supplier can be instantly verified. Once verified, the bank is able to offer digital trade financing services to upstream firms in the ecosystem within 24 hours in an efficient, more accessible fashion.
“By using new technologies such as blockchain and APIs, we hope to democratise trade finance by providing SMEs more affordable and convenient access to bank credit to enable them to realise their business ambitions, serve their customers well and expand into new markets with ease,” said Neil Ge, CEO of DBS China.
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