PBoC-Backed Blockchain trade platform, which is aiming to increase the efficiency of interbank transactions, has reportedly entered the final testing phase. The project also plans to aid small and medium-sized businesses to be able to have an access to a wider range of financial tools.
5 September, AtoZ Markets – A Blockchain trade finance platform organized by the central bank of China, the People’s Bank of China, has reportedly made its way to the testing phase. The official launch is expected in the near future, as well.
PBoC-Backed Blockchain Trade Platform Enters Final Trial
As per the report from one of the local news outlets, the first phase of the so-called Bay Area Trade Finance Blockchain Platform has been already deployed across financial institutions in the southern city of Shenzhen. It is now carrying out the final trials.
The Bay Area in Southern China is a special economic development zone that comprises major cities along the Pearl River. It also includes some specific administrative regions of Hong Kong and Macau. The trade finance project has been jointly formed and managed by the Digital Currency Research Lab of the People’s Bank of China and the central bank’s Shenzhen branch.
The project also saw participation from some other major commercial Chinese banks, such as the Bank of China, the Bank of Communications, China Merchants Bank, Ping’An Bank, and Standard Chartered.
The trade finance platform is aiming to increase the efficiency of interbank transactions. It also plans to aid small and medium-sized businesses to be able to have an access to a wider range of financial tools. These might include some asset-backed securities since the data can be easily shared among the participants through a distributed ledger network.
Hong Kong Central Bank Blockchain platform
In addition, greater transparency of transactions and information shared on the Blockchain is anticipated to provide local regulatory bodies with clearer oversight for advanced risk control and fraud prevention.
The PBoC-backed trade financial effort emerges as Hong Kong’s central bank is also rolling out a Blockchain trade finance platform. A number of financial institutions from the Chinese special administrative area are also taking part in this initiative.
The joint venture between the Chinese company Ping An Group’s fintech subsidiary OneConnect and the Hong Kong Monetary Authority is aimed to cut down the paperwork. It also plans to reduce the costs of security risks for participants.
The primary goal of the scheme is to reduce the amount of time and bureaucracy that is existent in the process of signing up new inexperienced firms to banking services. The scheme plans to do so by organizing the transaction process.
According to some of the online reports, “some” transactions will be able to be processed in just one day using Blockchain. This is in comparison to fourteen days through current methods.
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