HDBank recently joined hands with Contour’s blockchain network so that it could lead trade finance into the digital realm.
It is the latest financial institution which has linked itself with Countour’s network to establish the issuance of letters of credit while using blockchain and smart contracts.
Contour has been created on R3’s Corda tech to establish the transaction settlement process.
Earlier, Contour was popularly known as Voltron but in January 2020, the company rebranded itself while introducing its digitized letter-of-credit (LoC) service.
Basically, LoC is a formal letter a bank which assures that the payment from buyers reaches to the seller in a given time period. But if by chance, the payment is not received by the seller then letter obliges the bank to pay the full amount of purchase.
Earlier, LoC was being prepared on paper, but it was not only time consuming but also needs manual processing. As of now, the process has been put on the blockchain which would help the letters to get issued in a real-time with a secure and private manner.
The CEO of Contour, Carl Wegner, while explaining the use of LoC service said, “The focus with our network has always been to establish a neutral platform that all different types of banks and corporates can use for trade finance transactions”.
He further stated that offering a trade finance transaction is the sole motive of Contour and now, the HDBank would utilize this feature.
The CEO of HDBank, Pham Quoc Thanh, has recently said that the Contour has the potential to revolutionalize the issuance of LoC and by joining hands with it, HDBank has grabbed an opportunity.
Thanh further said that HDBank along with Carl and his team would work on issuance of LoC and on its flexibility. They would also establish the process and provide funds to the corporates in an efficient manner.
A report stated that for the fourth quarter of 2019, the Vietnam-based showed impressive growth, it secured assets of $9.89 billion.
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