Main Vietnamese financial institution HDBank has now change into the primary financial institution within the nation to situation letters of credit
Main Vietnamese financial institution HDBank has now change into the primary financial institution within the nation to situation letters of credit score, or L/C, utilizing blockchain expertise.
In line with a Jan. 6 report by native media outlet Việt Nam Information, the issuance, doc presentation and profitable cost of L/C on the blockchain marks a significant milestone on HDBank’s acknowledged purpose, to change into a “Comfortable digital financial institution”.
The members within the first transaction had been a neighborhood fiber importer and a Taiwanese yarn producer, together with the L/C advising financial institution in Taiwan.
Letters of credit score are vital paperwork in worldwide commerce, offering a assure from a creditworthy establishment, corresponding to a financial institution, {that a} purchaser’s cost to a vendor will likely be obtained on time and for the correct quantity. In essence, the financial institution underwrites the cost.
Utilizing blockchain expertise for L/C has many benefits, corresponding to providing the next stage of safety and a everlasting document of the transaction. It additionally reduces the time wanted to course of such transactions to a matter of hours.
HDBank joined the HSBC-backed Contour community for L/C again in Might 2020. As Cointelegraph reported, the R3 Corda-based platform obtained a business launch in Q2 2020, following a profitable trial in 2019.