As per a recent press report released by the Financial Times on Monday, one of the world’s largest banking institution by total assets, HSBC, has settled transactions worth $250 billion in the year 2018 by means of blockchain technology.
The transactions are performed on the bank’s blockchain platform named “FX Everywhere” which was introduced in February 2018. The press release also reported that HSBC has settled more than 3 million foreign exchange transactions using the blockchain. HSBC said that it has processed around 150,000 payments since the launch of its blockchain platform in Feb last year.
In May 2018, HSBC completed its first blockchain trade finance transaction. The financial services issued a letter of credit to Cargill, an agriculture firm, using the blockchain technology. The letter of credit was issued by Netherlands financier ING, and the letter covered the transportation of produce from Argentina to Malaysia.
FX Everywhere also assists in “orchestrating payments across HSBC’s internal balance sheets.” The release also stated that the platform ‘FX Everywhere’ had a high acceptance in the last year. The Company also publicized that such enhanced technology had made the settlements process simpler and added that its in-house blockchain-based platform ensures that additional protocols are not required for confirming the payments done.
From last year, HSBC has been continuously working on various applications on blockchain technology. In October, HSBC entered into a partnership agreement with Standard Chartered, PNB Paribas and others to sponsor a blockchain trade finance platform named as “eTrade Connect.” HSBC, along with others introduced this platform with a basic objective of improving the effectiveness of international trade financing and to achieve such an objective, the platform ensured to reduce the processing time needed for the approval of the trade loan applications from 36 hours to 4 hours.
HSBC’s Acting Head of Foreign Exchange and Commodities, Richard Bibbey, believes that post introducing and integrating the blockchain technology into its payment process the process has become much smoother and faster. He said “bank currently hosts thousands of FX transactions. Following prosperous implementation inside the bank, we are now exploring how this technology could help multinational clients – who also have multiple treasury centers and cross-border supply chains – better manage foreign exchange flows within their organizations.”