Bangkok Bank and GC Marketing Solutions Company Limited (GCM), a company under GC Group, the chemical flagship of PTT Group, have successfully studied and developed trade finance transactions between Thailand and Indonesia on R3’s CORDA Platform using Distributed Ledger Technology (DLT), or Enterprise Blockchain. It is the first time in Thailand Letters of Credit (L/C) transactions have been sent using Enterprise Blockchain and Bangkok Bank is the first Thai bank to join the Voltron project, which will revolutionize international trade by cutting processing time and paperwork by more than half.
Bangkok Bank Executive Director, Charamporn Jotikasthira said the Bank is developing innovative services that will support customers in the digital era. It was entrusted by GCM, a company under the GC Group, to revolutionize Letters of Credit, or L/C transactions, using Distributed Ledger Technology (DLT), or Enterprise Blockchain, for the first time in Thailand. Previously, L/C transactions required many documents but with Enterprise Blockchain, transactions are quicker, easier and more secure as all processes are transparent and can be verified. This breakthrough has cut processing time and paperwork by more than half, and reconciliation is no longer required as all related parties maintain the same set of data and are updated at the same time about status changes. This will enhance the efficiency of the customer’s business and that of the Bank.
In this study, PT. Bukitmega Masabadi, which is a trade partner of GCM, Indonesia, sent an electronic L/C via Bangkok Bank’s Indonesia branch to Bangkok Bank Thailand, to request export products as agreed in the L/C, effectively launching a new era for international trade services using Enterprise Blockchain. The Bank will continue to develop more innovative trade services so that customers can have sustainable success in the digital era. This reflects the Bank’s commitment to continually develop its services as a trusted partner and an international trade expert that can support customers’ success in global trade now and in the future.
Narongchai Pisutpunya, President of GC Marketing Solutions Company Limited, said “GCM has collaborated with Bangkok Bank to develop L/C transactions using Enterprise Blockchain between GCM in Thailand and our business partner, PT. Bukitmega Masabadi, in Indonesia. This breakthrough in the use of Distributed Ledger Technology will revolutionize international trade finance transactions through providing trade network integration and sharing trusted information on a single platform.” The traditional L/C process requires manual document validation and visibility and any incorrect information on the L/C needs to be amended which is costly and delays export.
“The Voltron solution provides synchronized data updates across parties, we can verify information before issuing the L/C and any changes can be seen simultaneously. Real-time information sharing on the Blockchain trade network enables GCM to shorten export delivery time for our customers and reduces fraud risk which is beneficial for our business. This service innovation reflects GCM’s mission to deliver business solutions that exceed expectations and support the business success of our clients,” Narongchai said.
Bangkok Bank is the first bank in Thailand to join R3’s Voltron project to develop L/C services using Enterprise Blockchain and it has been a member of the project since the beginning. Bangkok Bank’s international network covering major economies around the globe, especially in Asia and ASEAN, can help link the international trade networks of the participating banks in the Voltron project to cover all major regions of the world, including Asia. This will encourage customers in the import and export business to use Enterprise Blockchain to reach markets around the world.