EBRD and QNB ALAHLI accelerate trade finance digitalisation with a trial of Contour digital trade finance network with integrated CargoX Platform
(London - 24 February 2022) - The CargoX Platform for Blockchain Document Transfer (BDT) was used in three test transfers of letters of credit on the digital trade finance network Contour, conducted by the European Bank for Reconstruction and Development (EBRD) and QNB ALAHLI, one of the largest commercial banks in Egypt. The EBRD has designated digitalization as one of three priorities for the next five-year framework.
Processing large amounts of paper-based documents, as required by a letter of credit in global trade, is slow, cumbersome, and can result in delays. The performance of the exporter and importer is tied to the documents requested in a letter of credit.
The payment is transferred after the buyer’s bank requests the document from the seller and verifies that the submitted documents are in compliance with the documentary credit terms set by the buyer, and the rules of the letter of credit. This can include a commercial invoice, a bill of lading, a packing list, a certificate of origin, an inspection certificate, an insurance certificate, a health certificate or a phytosanitary certificate, a consular invoice, a draft or bill of exchange, and other documents.
“The EBRD has designated digitalisation as one of three main priorities under its current five-year Strategic and Capital Framework. As part of this approach, the EBRD is partnering with digital solution providers and banks to support digitalisation in trade finance in and beyond the economies where it operates,” said the official statement of the EBRD.
Read the full press release for a step-by-step explanation of how the documents are performed fully digitally.
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