Tata Steel, along with HSBC, has executed a blockchain-enabled paperless
trade transaction. According to the company, this is a global first for the steel industry.
The live financial transaction involved the export of steel by Tata Steel
to Universal Tube & Plastic Industries, UAE, a press release said on Wednesday.
The end-to-end paperless
transaction, executed over the Contour platform, was made possible by a unique collaboration pivoted by Tata Steel
across the spectrum over the Contour and essDOCS platforms. The letter of credit was issued by HSBC UAE for Universal Tube & Plastic Industries, UAE (importer), with HSBC India
as the advising and negotiating bank for Tata Steel, India (exporter).
This transaction validates the commercial and operational viability of blockchain
as an alternative to conventional exchanges for paper-based documentation.
has also signalled its intent to explore similar opportunities in other geographies as well.
“We continuously leverage our in-house potential and that of the external ecosystems through carefully curated partnerships to drive innovation. Adoption of this platform is in line with our objective of agility and enabling a faceless yet trustworthy all-time interface to better customer experience. This unique initiative, executed in collaboration with HSBC, demonstrates our continued efforts to lead technology-led disruptions by challenging the status quo,” Peeyush Gupta, vice-president (steel marketing & sales), Tata Steel, said.
With trade documents digitised, corporates can reduce the costs associated with handling paper-based documents, its reconciliation and streamline the processing flow.
The use of blockchain
technology in trade finance enables comprehensive visibility for all involved parties and enhanced security. It helps to significantly reduce the document negotiation and banking transaction cycles from weeks to a few days. It also speeds up the velocity of trade, particularly in situations where shipping routes are relatively short.
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