The Hong Kong Monetary Authority (HKMA) announced today (31 October) the official launch of eTradeConnect, a blockchain-based trade finance platform developed by a consortium of twelve major banks in Hong Kong. Formerly known as the Hong Kong Trade Finance Platform, eTradeConnect aims to improve trade efficiency, build better trust among trade participants, reduce risks and facilitate trade counterparties to obtain financing by digitising trade documents, automating trade finance processes and leveraging the features of blockchain technology.
The commercialisation of the trade finance project was first announced in Oct 2017 arising from the fruitful results of an earlier proof-of-concept (PoC) trial facilitated by the HKMA. The project was initially led by seven major banks1 and later joined by five additional banks2, adding up to a consortium of twelve member banks. eTradeConnect is the first large-scale multi-bank blockchain project in Hong Kong.
In order to facilitate cross-border trades, the HKMA has been proactively looking for opportunities to connect eTradeConnect with trade platforms in other regions. Today, the HKMA witnessed the signing of a Memorandum of Understanding between the operators3 of eTradeConnect and the we.trade4 to conduct a POC on connecting the two platforms.
Howard Lee, Deputy Chief Executive of the HKMA, said, “It is a remarkable moment to witness the birth of the first blockchain-based trade finance platform built by key industry players in Hong Kong. It demonstrates the willingness of the financial industry to adopt new technology in the new era of smart banking. Our next key milestone is to link eTradeConnect with platforms from other regions in order to enable cross-border trade financing. The connection between eTradeConnect and we.trade platform paves the way for the digitalisation of cross-border trades in the Asia and Europe trade corridor, and will serve as a good reference for the future connection of eTradeConnect to other trade finance platforms.”
Roberto Mancone, Chief Operating Officer of we.trade, echoed this sentiment, “we.trade is delighted to partner with eTradeConnect, a platform facilitated by the HKMA. Our co-operation confirms our roadmap and as the first step of developing “network of networks” in blockchain based trade finance solution. This exciting collaboration has the potential to unlock trade finance barriers for between Europe and Asia and through interoperability create an ecosystem that combines all the different stages of trade.”
Hong Kong Monetary Authority
31 October 2018
Mr Norman Chan, Chief Executive of the Hong Kong Monetary Authority at the launching ceremony of eTradeConnect.
Mr Norman Chan, Chief Executive of the Hong Kong Monetary Authority and senior executives of 12 banks at the launching ceremony of eTradeConnect.
Ms Haster Tang, Chief Executive Officer of the Hong Kong Trade Finance Platform Company Limited (second from left), and Mr Roberto Mancone, Chief Operating Officer of we.trade (second from right) sign the Memorandum of Understanding on collaboration. The signing ceremony is witnessed by Mr Colin Pou, Executive Director (Financial Infrastructure) of the Hong Kong Monetary Authority (first from left) and Mr Thierry Roehm, Board member of we.trade (first from right).
1 The seven major banks include Australia and New Zealand Banking Group Limited, Bank of China (Hong Kong) Limited, The Bank of East Asia Limited, DBS Bank (Hong Kong) Limited, Hang Seng Bank Limited, The Hongkong and Shanghai Banking Corporation Limited and Standard Chartered Bank (Hong Kong) Limited.
2 The five additional banks include Agricultural Bank of China Limited, Bank of Communications Co Ltd, BNP Paribas, Industrial and Commercial Bank of China (Asia) Ltd and Shanghai Commercial Bank Ltd.
3 we.trade was established by nine banks in Europe to address the expectations of their customers to make cross-border trade more straightforward. At present, we.trade is available across fourteen European countries.