Nordic financial services group Nordea Bank is now making the blockchain-based trading platform we.trade available to all its small and middle-sized business (SME) customers.
The we.trade platform was developed by Nordea, along with 12 banks including Deutsche Bank, HSBC, KBC, Natixis, Rabobank, Societe Generale, Banco Santander and UniCredit, using the IBM Blockchain platform to exploit a licensed blockchain for transactions in supply chain trade financing. The platform allows companies to identify trusted counterparties for establishing new commercial relations – providing full visibility on transaction and shipment status, digitalizing the whole process from order creation to payment execution.
Following a successful soft launch last month, Nordea said that the we.trade platform will now be available to all Nordea SME customers, with trading controlled through a set of rules designed to bring security to the process. Trading parties are offered to choose what events will trigger payments, while contracts can be drawn up in multiple languages.
“We see more and more small and medium sized companies getting involved in cross border trading,” said Magnus Montan, head of Business Banking. “There are some common challenges that they face. The biggest one is related to trust in their overseas trading partners. we.trade is not only about providing trade finance, it is something much bigger than that. It is about enabling trade and with we.trade we are creating an ecosystem for the global trade, where trust is an integral part.”
According to Patrik Zekkar, Global Head of Trade Finance & Working Capital Management at Nordea, almost 60 percent of the SMEs said that they have to make advance payments, which means there’s a sense of insecurity surrounding cross-border trade.
“This is unfortunate, not only from a liquidity standpoint, it may also lead to companies refraining from trading and not growing,” said Zekkar. “We want to change how our customers do business with each other and are now building an ecosystem for it.”
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