Standard Chartered Bank Pioneers Bangladesh’s First-Ever Blockchain Letter of Credit

Published 

Standard Chartered Bank has successfully executed the country’s first blockchain transaction by issuing a Letter of Credit (LC) for Viyellatex Ltd over the Contour blockchain network.

Viyellatex Ltd, one of the country’s leading ready-made garments exporters, imported textile items from Viyellatex Spinning. Standard Chartered Bank acted as the Issuing Bank for the Applicant, as well as the Advising Bank for the Beneficiary of the LC. The entire transaction was paperless and completed digitally through Contour’s network.

Contour provides a distributed trade network enabling an enhanced degree of collaboration across the main 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 of this leading to an overall increase in efficiency and reduction in costs for all parties.

As one of the founding members of Contour, Standard Chartered benefitted from Contour’s network which simplifies the LC process, delivering shorter settlement times, instant discrepancy resolution and simplified sanctions screening.

Mr Carl Wegner, CEO of Contour said: “Global trade lacks a solution that drives out inefficiencies, improves data transparency and enables interoperability between all trade participants. The long-established elements of trade finance don’t have sufficient integration, ultimately causing friction and unnecessary administration. These inevitably cause significant barriers for global trade growth, adding complexity, increasing cost and delaying the process for both banks and corporates. The Contour network can overcome these issues, providing a consistent and reliable infrastructure for global trade to flourish especially in countries like Bangladesh that counts on LCs for a significant part of their trade volumes. The recent transaction with Viyellatex Ltd serves to prove that a solution is out there and readily available for adoption. It’s also hugely positive to have Standard Chartered introducing this revolutionary technology for trade in Bangladesh and we’re proud to be a part of the first transaction in the country.”

Mr Naser Ezaz Bijoy, CEO of Standard Chartered Bank, Bangladesh said: “We are extremely proud to introduce Blockchain technology in Bangladesh for trade transactions. It has been a privilege to partner with Viyellatex Group to initiate the first Blockchain enabled Letter of Credit in the country. We are very excited to offer our clients improved speed and reduced risks of settlement offered by platforms such as Contours. We recognise that our clients are increasingly looking for new solutions to address the need for greater efficiency, and that this milestone represents the first of many such transactions that will follow.”

Mr K.M. Rezaul Hasanat, Chairman and CEO of Viyellatex Group said: “At Viyellatex Group, we always strive to provide quality products and services on time. We recognise that innovation and digitisation is key to remain competitive in today’s ever-changing global trade scenario. Blockchain technology will certainly increase trading efficiency and reduce turnaround time of the LC process. Hence, we are very happy and proud to collaborate with Standard Chartered Bank and become a part of the first trade transaction in Bangladesh using the revolutionary blockchain technology.”

The Ready-made Garments industry is the main export sector of Bangladesh. Most raw materials of this industry is sourced locally, through inland letters of credits. These inland LCs involve a lot of tedious paperwork. If these transactions can be moved into paperless Blockchain, major efficiencies can be achieved in local trade across this industry. There is a huge scope to scale up transactions over Blockchain if we can add all parties of the RMG supply chain onto this network.

Standard Chartered Bank is the largest international bank in Bangladesh, with a presence of more than 115 years in the country. The blockchain transaction is the latest among many other “firsts” that the Bank has introduced including ATM and credit cards. Standard Chartered was the first bank to issue a Letter of Credit from Bangladesh and has since retained its position as one of the top trade banks in the country.

Most recent episodes

40th Annual New York Cash Exchange: What Can Treasurers Expect?

Ahead of the 40th annual New York Cash Exchange, two of TMANY’s distinguished board members, David Miller and Timothy T. Hesler, CTP, provide TMI CEO, Robin Page, with a quickfire rundown of what attendees can expect from this year’s conference. Our guests share their aspirations for the event,...

00:00

Expectation-Beating Inflation Prints Ratchet Up Pressure on Monetary Policy

Welcome to the third edition of Liquidity Link Live, your exclusive market analysis provided by Northern Trust Asset Management, one of the world’s largest cash managers. Tune in each month to discover the very latest insights on the UK, Eurozone and US markets. This edition was recorded on the 9th May...

04:48

Making the Sustainable Transition: A Roadmap to ESG in Treasury

Over the last 18 months, Societe Generale has experienced a steady increase in requests from their corporate clients to integrate ESG features in treasury management.  Louis-David Rouyer, Philippe Pougeard, and Emmanuelle Petelle (Societe Generale) provide TMI’s Eleanor Hill with a whistlestop run...

22:24

Lift Off for Fed Rate Rises

Welcome to the latest edition of Liquidity Link Live, your exclusive market analysis provided by Northern Trust Asset Management, one of the world’s largest cash managers. Tune in each month to discover the very latest insights on the UK, Eurozone and US markets. This edition was recorded on the 5th of...

04:58

Treasury in 2022 and Beyond

Industry experts Bob Stark (Kyriba) and Sebastian di Paola (PwC) join TMI’s Editor, Eleanor Hill, to explore the very latest treasury trends – and to discuss how smart treasurers can get ahead of the game by ...

43:21

How BearingPoint Harnessed Data-Driven Forecasting with CashAnalytics and SAP

Listen back to our recent forecasting masterclass, where Group Treasurer Eveline Stam, and Conor Deegan (CashAnalytics) provided TMI’s Eleanor Hill with a comprehensive overview of how consultancy firm BearingPoint achieved company-wide cash forecasting nirvana by combining specialist solutions from...

37:14

The 3 T’s of The Future: Tech, Treasury, and Transformation

Over the past two years, an increasingly dynamic environment has not only accelerated technology development – from quantum computing to blockchain technology, and even the metaverse – but also technology adoption, bridging colleagues and breaking down silos in a remote work world. In this podcast,...

44:02

Monetary Policy Continues to Drive Markets as Ukraine Invasion Weighs on March Meetings

Welcome to the second edition of Liquidity Link Live, your exclusive market analysis provided by Northern Trust Asset Management, one of the world’s largest cash managers. Tune in each month to discover the very latest insights on the UK, Eurozone and US markets. This edition was recorded on the 3rd of...

05:25

Tax Spotlight: How the OECD’s Two-Pillar Solution Impacts Treasury

Aaron Lee and Joseph Lee (DBS Bank) join TMI’s Eleanor Hill to discuss how the OECD’s Two-Pillar Solution aims to address the tax challenges arising from the digitalisation of the economy. Ahead of the 2023 implementation date multinational corporates will have much to consider around these reforms....

24:00

FX Connections: Bringing Transparency to Cross-Currency Payments

Cross-border activity is growing at a remarkable rate, making FX payments a hot topic for treasurers across the globe.  In this TreasuryCast episode, Eleanor Hill asks Daniela Eder and Gibran Maqsood (Barclays Corporate Banking) to provide their key action points around FX payments in 2022. Our guests...

21:00