Major bank HSBC has revealed the effective enactment of a letter of credit (LC) on a blockchain in Malaysia.
English language local fintech news agency Fintech News Malaysia revealed the development on October 14, taking note that the transaction involved packaging company Simply Packaging bringing in resin from an undisclosed Singaporean chemicals firm. The issuing bank was HSBC Malaysia, while the nominated bank was HSBC Singapore.
According to the report, this is the eleventh blockchain-powered transaction facilitated by HSBC and the first such pilot conveyed by its Malaysian branch. HSBC Malaysia CEO Stuart Milne remarked on the successful trial:
“I am very pleased that HSBC has pioneered Malaysia’s first pilot blockchain LC transaction. This showcases our strong commitment and ability to support cross-border trade by Malaysian businesses using cutting-edge technology platforms.”
As per the article, the trade among Malaysia and Singapore was worth more than $85 billion a year ago, and the managerial paperwork frequently defers the conveyance of products across this trade route. The exchange and processing of the documents associated purportedly take five to 10 days usually, while the pilot figured out how to cut the time to 24 hours.
As previously reported in September, at the time, HSBC has finished the first yuan-denominated letter of credit transaction on a blockchain utilizing the Voltron trade finance platform.