Bank of America Merrill Lynch is collaborating with Microsoft to build and test blockchain applications for letter of credit (L/C) transactions.

If the tests on L/C transactions go well, the collaborators will go on and look at blockchain applications in other aspects of trade and corporate finance.

Aims and roles

Bank of America and Microsoft are currently testing a platform for managing L/C transactions.

The aim is to create frameworks and establish best practices for blockchain exchanges between businesses and their customers and banks.

Microsoft's treasury experts will serve as advisors and initial test clients on an implementation of the company's Azure blockchain-as-a-service suite for standby L/Cs.

Microsoft's interest

It appears that Microsoft's treasury operations are interested in blockchain applications not just in terms of product development, but also for their own use.

Specifically, they want to see how they can be applied to manage transactions related to Microsoft's corporate treasury activity and strategic business investments and acquisitions.

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