Contour and DBS Support First Secured Letter of Credit Transaction Between Nanjing Iron & Steel and Rio Tinto on Blockchain Network
Singapore – Contour, together with member bank, DBS Bank, continue to push the digitalisation of trade finance with the completion of the network’s first fully digital end-to-end secured Letter of Credit (LC) between Nanjing Iron & Steel, Singapore Jinteng International and Hope Downs Marketing Company (an equal Joint Venture between Rio Tinto and Hancock Prospecting).
Facilitated by DBS Bank as the issuing and advising bank, which played an integral role in connecting the parties across the mining value chain, and Contour partner essDOCS, which enabled management of the electronic bill of lading through its CargoDocs solution, the approval of key contract terms, LC issuance and presentation of export documents under the LC were carried out electronically from start to finish on the Contour network. This not only resulted in reduced trade document turnaround times but also provided greater transparency with all parties having access to real-time status updates at each step of the transaction.
By providing a neutral and open network, Contour is able to offer its solution to a wide range of financial institutions and corporates, allowing individual technology providers to integrate within its network to further streamline LC issuance. The transaction highlights Contour’s growing presence in Asia as an industry standard for digitising trade finance documentation, and marks DBS Bank’s second transaction on the network since it became a member bank in May.
Carl Wegner, CEO at Contour, said: “With yet another transaction pair on our network, we are showing the full scope of what a blockchain solution can offer to trade finance. This is a hugely positive sign of a changing industry - organisations are taking advantage of our technological solution and using it to transform a previously paper-based process that is outdated and unfit for purpose in the modern world. Our growing presence in China, working with some of the region’s leading exporters, showcases the benefits of our network and we are confident we will see more organisations take advantage of blockchain for trade finance throughout the rest of the year.”
Sriram Muthukrishnan, Group Head of Trade Product Management, DBS Bank, said: “An ecosystems approach is vital to unlocking a network effect to propel trade into the digital era, and continued collaboration across businesses, banks and technology providers remains key. The silver lining arising from challenges faced in the current environment is a rapid acceleration and acceptance across all industries and geographies of the need to digitalise to survive and thrive in the ‘new normal’, and we expect to see more companies transitioning from analogue-based trade finance processes to digital ones in the near future.”
Alexander Goulandris, Co-CEO, essDOCS said: “The imperative to digitise trade and trade finance has become increasingly vital as the world adjusts to life post-Covid. The results of our joint work with Contour are bearing major fruit and we are confident that milestone transactions combining CargoDocs and Contour will continue to gain pace, as banks and corporates seek to benefit from the major efficiencies gained by being a part of this essential digital trade ecosystem.”