Dltledgers CEO said the ongoing economic crisis is negatively affecting the trade finance industry and blockchain will help protect banks from scandals.
Dltledgers is working on using blockchain in trade finance transactions. According to CEO Samir Neji, there have been several recent scandals involving major players such as Hin Leong, ZenRock, Agritrade and Hontop Energy. As a result, banks’ losses amounted to more than $ 6 billion. Against this background, banks ABN Amro, Societe Generale and BNP Paribas completely left the industry.
“It will become much more difficult for merchants and other businesses to move goods around the world. This is stifling a sector that is already struggling, ”said Neji.
He stressed that in this situation, distributed ledger technology (DLT) can come to the rescue. Thanks to the blockchain, the approval process will be significantly accelerated, the need for a lot of paperwork, telephone conversations and emails will almost disappear. All necessary information, signatures and consent will be placed in an immutable register, and thanks to its transparency, the risks of fraud will be significantly reduced.
“If banks see that transactions carry much less risk, it will be easier for companies to attract financing, and interest rates will be lower. This will have a positive effect on the entire sector, ”says Neji.
In terms of technology adoption, instead of talking, industry participants simply need to show all the benefits of blockchain in trade finance. They don’t need to know the technological details – they just need to be told about the advantages of such a platform.
“I believe all this blockchain hype will disappear. Platforms like ours will just work and provide new opportunities. Our engineers work the same way the engineers who made mobile phones, color TVs and the Internet did, ”said Neji.
Recall that in June, Turkish bank İşbank and German Commerzbank announced the completion of Turkey’s first trade finance transaction using a blockchain platform.