Home Crypto News From Beta to Beyond: Trade Finance Blockchain Platform ‘Contour’ Is Live

From Beta to Beyond: Trade Finance Blockchain Platform ‘Contour’ Is Live

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Contour, the blockchain commerce finance initiative owned by eight main banks: Bangkok Bank, BNP Paribas, CTBC, HSBC, ING, Standard Chartered, SEB and Citi, has formally left its beta section.

GT Review (GTR) reported that the platform, which was beforehand often called Voltron or Letter of Credit (LoC) blockchain, is alleged to act as a DLT-based international community for commerce finance.

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Bringing Blockchain to the World of Trade Finance

The transfer past beta is Contour’s newest step on the race to deliver a workable blockchain platform to commerce finance.

Carl Wegner, CEO of Contour.

However, in accordance to GTR, this ‘race to bring trade finance into the digital age’ has induced the formation of numerous fragmented platforms into the commerce finance area.

This resulted in some considerations: many within the trade expressed worries that no single platform would attain the important mass essential to be really transformative, and even really purposeful, for the trade as an entire.

The skill to acquire widespread adoption within the commerce finance trade is what Contour’s shareholder banks are betting on.

“I am struggling to think of another platform that has got so many banks onboard across different corridors and clients that have already undertaken live transactions and seen the value from it,” mentioned Vinay Mendonca, international head of product, propositions and structuring, commerce and receivables finance at member financial institution HSBC, to GTR.

HSBC’s Vinay Mendonca.

“So, for us, there is the necessary catchment and foundation to drive scale.”

Mendonca additionally commented that HSBC now plans to transfer all of its common documentary credit score shoppers onto the community, and is asking its monetary establishment shoppers to be a part of the platform as properly, notably in giant markets comparable to India, Bangladesh, and Vietnam.

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The Journey to Beta and Beyond

After launching as a prototype utility on R3’s Corda in 2017, the platform premiered at Sibos in Sydney earlier than present process testing by 80 banks and corporates, with trials in 17 nations throughout numerous industries. Contour gained standing as a standalone authorized entity originally of this 12 months.

Carl Wegner, CEO of Contour, instructed GTR that the testing course of was a key a part of the transfer out of its beta section: “every time we did a transaction, we carried out a review, and we have been taking on all those inputs and learning from them,” he mentioned.

Addressing Legal Challenges

However, there have been challenges alongside the best way: “with banks and corporates initially using Contour to manage the letter of credit (LC) process, one of the key areas of work has been around the legal framework,” Wegner mentioned.

This is especially true as a result of “although it is technologically possible to execute transactions using negotiable instruments registered via blockchain technology, in many jurisdictions these [transactions] are recognised only if they are on paper and signed, hindering the advancement of many digitisation initiatives.”

To sort out these authorized challenges, Contour’s members and pilot testers have developed a rulebook and membership settlement that will likely be included with the challenge’s launch.

Wegner described the rulebook as “robust, but as simple as possible.”

Indeed, HSBC’s Vinay Mendonca instructed GTR that “the rulebook is basically essential.

“Rather than having to string collectively 4 or 5 totally different authorized agreements between purchaser, vendor, purchaser’s banks and vendor’s banks, which was very onerous, [the rulebook] makes it very simple for everyone to enroll and know what their roles and duties are.”

Mendonca additionally mentioned that the rulebook was developed in step with ICC Uniform Customs and Practices (UCP) which might be used for documentary credit.

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