China Everbright Bank Utilizes Ant Blockchain For Supply Chain Finance
According to Shanghai Securities News, China Everbright Bank (CEB) declared that it had launched a supply chain finance blockchain. The project utilizes the Ant Blockchain Duo Chain solution for the supply chain. The “duo” points to the intersection between blockchain and supply chain.
While CEB is not as high as the big four Chinese state-owned banks, it’s nevertheless very substantial with total assets of $662 billion in June 2019. It’s partially recognized by the state and ranked as 151 on the Forbes 2000 list of largest companies in 2019.
The report alleges that CEB is the first Chinese bank to use the Duo Chain solution after it commenced to operate with Ant Financial during the second half of 2019. Ant revealed the technology solution last year and initially examined it with an automobile manufacturer.
As with all supply chain finance solutions, the opening point is the accounts payable owed by a big company to its suppliers. Given the bank has access to details and understands the invoices come from the larger creditworthy company, it’s more positive to lend to these smaller suppliers.
Contrarily, these SMEs might not fit for trade credit because there’s a lack of accurate data about their business. And even if the SME did qualify, outside of supply chain finance, it would be more costly because the bank would recognize a higher risk, and it would want more work from the small business.
The CEB solution brings several moving parts collectively. It utilizes identity and authentication through CEB’s existing platforms. And other integrations include external and internal data, credit reporting, and bank account systems.
In the recent epidemic, a key advantage is the solution is solely online.
This isn’t CEB’s first foray into blockchain trade finance. Its a participant in an initiative from the China Banking Association. And its Hong Kong branch took part in a trial of the Contour Letter of Credit blockchain (formerly called Voltron).