UAE-based Universal Tubes & Plastic Industries and India’s Tata Steel have executed the global steel industry’s first blockchain-based live trade finance deal.
The transaction enabled the digitisation of the documentation required for Universal Tubes to import flat carbon steel from Tata Steel through a platform called Countour, a blockchain-based solution.
The platform helps companies cut paperwork, thus saving time when moving goods between borders.
It allows all parties to have visibility of a trade while also ensuring that no single organisation controls all the data. This ensures that banks, importers and exporters have improved visibility without compromising security, said HSBC, a founding shareholders of Contour.
"The transaction [between Universal Tubes and Tata Steel] is a real-case scenario of the operational viability of blockchain as an alternative to conventional exchanges of paper-based documentation," the statement said.
Earlier this week, UAE launched UAE Trade Connect, a blockchain-based platform designed to prevent economic crimes such as under-invoicing, money laundering and fraud in trade finance.
Trade finance is usually paper-intensive and involves manual processes that tend to delay the physical delivery of goods from one country to another. By digitising the processes, transaction times can be closed from five to ten days to just under 24 hours, the statement said
(Writing by Cleofe Maceda; editing by Brinda Darasha)
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© ZAWYA 2021