Banking News

New DBS blockchain solution speeding up Chinese SME trade finance

(11 September 2019 - China) DBS China has announced its first multi-tier financing facility on a logistics blockchain platform to help small and medium-sized enterprises (SMEs) in China gain faster access to trade financing.

DBS is leveraging new technology to allow it to provide digital trade financing to more than 1,000 suppliers in logistics supply chain ecosystem within 24 hours. Developed in partnership with a leading Chinese logistics player, the system is designed to offer multi-tier financing solutions to more than 1,000 of suppliers in the company’s supply chain ecosystem. Leveraging DBS’s Application Programming Interfaces (APIs), the bank integrated its digital onboarding service into the blockchain platform, allowing DBS to verify the credentials of a supplier within seconds.

“DBS believes in the huge growth potential in the Greater Bay Area, also known for being the ‘Silicon Valley of the East. This is a groundbreaking transaction for DBS in China as we use digital technologies to develop new business models with our corporate clients. As part of our digital transformation strategy, we integrated financial services into the blockchain platform to develop a new business model and better serve upstream suppliers” said DBS China Head of Large and Mid-Cap Corporates for Institutional Banking, Ginger Cheng.

“The amount of data that is available is increasing. It is up to us to consume that data. What is the trade finance gap? It’s about processes - shipments, customs receipts, inspections but equally you also need to make a credit decision on whoever is asking for the trade financing" stated DBS group Head of Global Transaction services (trade product management) Sriram Muthukrishnan, outlined in a panel at GTR Asia discussing the potential for digitisation the frictions in global trade that many domestic trade processes are set to improve based on data analysis. “Often we take very conventional approaches. Data can actually be a very powerful tool for financing the small and medium enterprises (SMEs) and micro-SMEs simply based on transactional flow information and internet of things-based information whether it comes from a blockchain or whether it comes from other platforms.”