The pilot project is aimed at building the digital trade finance and supply chain finance solution based on a blockchain platform
Alfa-Bank and Novolipetsk Steel Company (NLMK), in collaboration with Commerzbank, and Vesuvius have launched a pilot project of cross-border payments through Marco Polo international trade finance network.
The pilot project is aimed at building the digital trade finance and supply chain finance solution based on a blockchain platform.
Alfa-Bank trade finance head Dina Merkulova said: “We launched our first distributed ledger technology in trade finance as early as 2017. Since then, corporate blockchain solutions have been considerably elaborated, and earned our clients’ confidence and proved their applicability to real business processes.
“Projects such as Marco Polo create added value for clients ensuring more international trade transparency and manageability thanks to integrated bank payment, finance and discount instruments.”
The Marco Polo network is based on R3 Corda
The foreign trade finance transaction trial marks the first Russian-German import-export operations financing project for Marco Polo.
The Marco Polo network is based on R3 Corda that allows Alfa-Bank to offer a wide range of international trade finance solutions and integration into the global trade ecosystem for its clients.
The network offers a range of Application Programming Interfaces (APIs) to its members for direct interaction with ERP systems.
In addition, Marco Polo facilitates international trade participants to make payments, create irrevocable payment obligations and discount accounts receivable within a unified transparent system.
Vesuvius treasury cash coordinator Christian Greving said: “Integrated working capital solutions directly related to the contract, issued invoices and shipping documents definitely benefit all the parties, and our experience with Marco Polo demonstrates that core processes can really be streamlined.”
NLMK said that it has taken part in the pilot project to optimise the process of interaction with partners based on blockchain technology.
Commerzbank global finance products trade head Enno-Burghard Weitzel said: “Our international corporates show continuous interest in piloting the Marco Polo Payment Commitment together with us and banks of our global network, like Alfa-Bank.
“This new instrument, which is provided upon digital processing and matching of trade data in the Marco Polo network, meets our customers’ growing demand for increased speed of transaction and transparency, optimised financing, enhanced working capital management and possible integration of ERP systems.”