Last week Standard Chartered announced its investment into Contour, a blockchain-based open industry platform that will initially focus on digitally creating, exchanging, approving and issuing Letters of Credit (LCs), following the full commercialisation of its offering and appointment of CEO Carl Wegner. As one of the founding members, the Bank will continue to collaborate with Contour, bringing its expertise and digital capabilities to deliver a faster and frictionless experience for clients accessing trade finance.
Since its inception, the platform has revolutionised documentary trade by transforming the previously paper intensive ways of working. By digitising the end-to-end process from the issuance of LCs to confirmation and documentation presentation, all trade participants can view real time updates on the progress of their transaction. The results of two live pilots with large clients in the petrochemicals industry conducted by Standard Chartered in Thailand and Singapore demonstrated greater transparency, improve cost efficiencies and reduced settlement risks across the supply chain, as well as quicker access to working capital.
In the next phase of development, Contour will look at further expanding its ecosystem to include more banks, technology providers and other established trade finance networks, with the vision of becoming a new industry standard for the digitisation of global trade. To that end, Standard Chartered will be injecting its smart guarantee capabilities, which will enable the digitisation of the bank guarantees process from initiation to claim handling.
“Our investment into Contour underscores our commitment to forge partnerships and solve common industry challenges – taking paper out of the process while improving speed and accuracy,” said Lisa Robins, Global Head of Transaction Banking, Standard Chartered. “With our footprint across the world’s fastest-growing trade corridors, we have the unique opportunity to support our clients in achieving a more sustainable supply chain, by improving access to financing through paperless trade and simpler processes.”
Samuel Mathew, Global Head, Documentary Trade Product Management at Standard Chartered, added: “We are excited to bring this co-created initiative into full production alongside other investors in Contour, which is undoubtedly a significant milestone in our journey towards transforming documentary trade. In particular, we look forward to introducing our smart guarantee capabilities, announced in 2018, into Contour. We believe this new platform will drive scale and adoption in the industry, thereby improving efficiency and better risk management for us and our clients.”
By investing in technology and building partnerships, Standard Chartered is focused on delivering a seamless experience in connecting its clients and their ecosystems. In July 2018, the Bank announced its collaboration with Siemens on smart guarantees to create an end-to-end blockchain-based smart guarantees proposition in trade finance. Last August, it announced a collaboration with SAP Ariba to make its financial supply chain solutions easily accessible to businesses in the Asia Pacific region through Ariba Network. The Bank most recently made a strategic investment into Linklogis, China’s leading supply chain financing platform, to enhance its joint supply chain ecosystem proposition and provide suppliers with access to affordable and convenient financing.