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Trade Finance
Published  5 MIN READ

Beefing Up Open Account Trade with Blockchain Technology

Moving and marketing in excess of 100,000 tonnes of meat products annually throughout the world, GPS Food Group was keen to find an innovative way to make its open account trade transactions faster, safer and more competitive. The company recently participated in a successful pilot of the we.trade blockchain platform, a collaboration between HSBC and eight consortium banks, to do just that.

As a specialist business that manages the procurement, production, logistics and marketing elements of the supply chain for the meat trade, GPS Food Group (GPS) has operations in every corner of the globe: from the UK and Ireland, to Norway, South Africa, China, and Brazil. Many of the geographies in which the group operates favour open account trade, introducing a variety of risks into the financial supply chain that need to be carefully managed.

Padraig McCarthy, Director, at GPS explains: “Trading internationally always carries risks – from late payment to non-payment, as well as the challenges around unknown counterparties. Another growing concern is fraud. Like any business, we have been contacted by criminals endeavouring to extract funds through fraudulent invoices. A number of our customers have also been victims of fraudulent activity, whereby emailed invoices have been intercepted and bank account details changed, so we are very conscious of the need for greater security in all trade transactions.”

As such, GPS was looking for new ways to improve its international trade processes. “We were interested in the blockchain concept because of the transparency and security it offers. When HSBC approached us about joining the we.trade pilot, it was something that we were keen to get involved with. We already had a great relationship with HSBC, they knew our business well, we worked with them in a number of regions, and we were aware of the development they were doing with IBM on this project. So, for us, it was a great opportunity to try out an innovative solution with a respected and established international partner,” says McCarthy.