Major bank HSBC has announced the successful enactment of a letter of credit (LC) on a blockchain in Malaysia.
On October 14, it has been reported by Fintech News Malaysia, the English language local fintech news outlet that the development notes the transaction involved Simply Packaging, a packaging firm, importing resin from an unspecified Singaporean chemicals company. The issuing bank was HSBC Malaysia and the nominated bank was HSBC Singapore.
As per the report, this is the eleventh blockchain-powered transaction carried out by HSBC and the first such pilot carried by HSBC Malaysia, its Malaysian branch.
Stuart Milne, the CEO of HSBC Malaysia, commented:
“I am very pleased that HSBC has pioneered Malaysia’s first pilot blockchain LC transaction. This showcases our strong commitment and ability to support cross-border trade by Malaysian businesses using cutting-edge technology platforms.”Stuart Milne
According to the article, trade between Malaysia and Singapore was worth over $85 billion last year and the administrative paperwork often delays the delivery of goods traveling across this trade route.
The exchange and processing of the documents involved in reportedly take five to 10 days on average, while the pilot managed to cut the time to 24 hours.
It has also been reported by Cointelegraph that in September, HSBC has completed the first yuan-denominated letter of a credit transaction on a blockchain using the Voltron trade finance platform.
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