Blockchain Trade Finance Platform for Guangdong-HK-Macao Greater Bay Area Enters Test Phase
A new blockchain trade finance platform shepherded by the People’s Bank of China, the country’s central bank, has entered the test phase, the state-run Shanghai Securities News reported on September 4.
The first phase of the platform, dubbed “ Greater Bay Area Trade Finance Blockchain Platform” , has been deployed across financial institutions in the southeastern Chinese metropolis of Shenzhen.
Greater Bay Area refers to the Chinese government’s scheme to link Hong Kong, Macau, and nine Guangdong province cities into an integrated economic and innovative hub, rivaling San Francisco, New York and Tokyo. The blockchain-based trade finance platform, part of the ambitious plan, is aimed at facilitating financial transactions and trading .
The platform is jointly pushed through and coordinated by the Digital Currency Research Lab of the PBoC and the central bank’s Shenzhen branch. The main stakeholders involved in the platform include Bank of China, China Construction Bank, China Merchants Bank, Ping An Bank, Standard Charted Bank, and BYD Co.Ltd.
The trade finance project, with greater levels of transparency and information shared on the blockchain,provides local regulators with a comprehensive regulatory system for trade finance, allowing them to monitor various financial activities in real time and to improve risk control.
Analysts point out that the platform will facilitate the formation of market trust mechanism and help small and medium-sized enterprises (SMEs) access a range of financing tools, better serving the real economy. Further, it can also “help banks to conduct business authenticity audits, reduce business costs, improve efficiency and prevent relevant risks.
In July, the Hong Kong Monetary Authority(HKMA), the de facto central bank of the city, has announced it will launch one of the world’s largest government-backed blockchain trade finance form with 21 banks in the coming months in bid to substantially reduce paper work, cost as well as security risks for participants.