SCB pioneers Bangladesh’s first-ever blockchain LC

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Standard Chartered Bank acted as the issuing bank for the applicant, in addition to the advising bank for the beneficiary of the LC. The entire transaction was paperless and completed digitally through Contour’s network

Standard Chartered Bank successfully executed the country’s first blockchain transaction by issuing a letter of credit (LC) for Viyellatex, an export oriented apparel manufacturer, using Contour's blockchain network.

Viyellatex Ltd, among the country’s leading readymade garment (RMG) exporters, imported textile items from Viyellatex Spinning, said a statement. 

Standard Chartered Bank acted as the issuing bank for the applicant, plus the advising bank for the beneficiary of the LC. The complete transaction was paperless and completed digitally through Contour’s network, it added.

The RMG industry is Bangladesh’s main export sector, where most recycleables of the industry are sourced locally, through inland letters of credits.

In these inland LCs involve a whole lot of tedious paperwork but blockchain transactions could be moved into paperless in addition to efficiencies can be achieved in local trade across this industry. 

“We are really proud to introduce Blockchain technology in Bangladesh for trade transactions. It's been a privilege to partner with Viyellatex Group to initiate the first Blockchain enabled Letter of Credit in the united states,” said Naser Ezaz Bijoy, CEO of Standard Chartered Bank, Bangladesh.

"Standard Chartered Bank is very excited to provide our clients improved speed and reduced risks of settlement made available from platforms such as for example Contour," said Naser.

"We recognize that our clients are increasingly looking for new solutions to address the necessity for greater efficiency, and that this milestone represents the first of many such transactions that may follow," he added.  

“At Viyellatex Group, we always make an effort to provide quality product or service promptly. We recognize that innovation and digitization is paramount to remain competitive in today’s ever-changing global trade scenario. Blockchain technology will surely increase trading efficiency and reduce turnaround time of the LC process,” said KM Rezaul Hasanat, chairman and CEO of Viyellatex Group. 

"We are incredibly happy and proud to collaborate with Standard Chartered Bank and be part of the first trade transaction in Bangladesh using the revolutionary blockchain technology," said Hasanat.  

Carl Wegner, CEO of Contour said: “Global trade lacks a remedy that drives out inefficiencies, enhances data transparency and permits interoperability between all trade participants. The long-established factors of trade finance don’t have satisfactory integration, ultimately causing friction and unnecessary administration.” 

These inevitably cause significant barriers for global trade growth, adding complexity, increasing cost and delaying the procedure for both banks and corporate, he added.

The Contour network can overcome these issues, providing a steady and reliable infrastructure for global trade to flourish especially in countries like Bangladesh that matters on LCs for a significant part of their trade volumes, said Wegner.

"The recent transaction with Viyellatex Ltd serves to prove that a solution exists and designed for adoption. Additionally it is hugely positive to have Standard Chartered introducing this revolutionary technology for trade in Bangladesh and we are proud to be a the main first transaction in the united states," he added.

Contour offers a distributed trade network enabling an improved amount of collaboration across the primary elements of trade with all participants leveraging the network to create and renew trade data in real-time. 

Built on R3’s Corda blockchain, Contour improves data transparency, removes administration costs and reduces friction in global trade: all this leading to a standard upsurge in efficiency and decrease in cross for all parties. 
Source: https://www.dhakatribune.com

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