Blockchain fintech we.trade, which marketed a bank payment undertaking (BPU) product as an alternative to a letter of credit (L/C), is winding up its operations and has proposed PwC as its liquidator according to the Irish Independent daily newspaper.

Owned by 12 European banks and IBM, we.trade launched commercially in January 2019. Its technology is currently licensed by 16 banks across 15 countries.

L/C alternative

Traders unable to obtain L/Cs, bank guarantees, invoice financing and credit insurance were a key target for we.trade, which proposed digital products such as its BPU as an alternative means of financing.

Under a BPU, the bank agrees to transfer a predetermined amount to the seller as soon as the agreed conditions have been met. It constitutes an irrevocable and absolute obligation on the buyer's bank.

Billed as "the world's first enterprise-grade blockchain-enabled trade finance platform", we.trade also offered traders access to insurance, credit rating, financing and logistics services.

Shareholders

IBM took a 7 per cent stake in the joint venture in 2020 but during that year in the midst of the Covid pandemic the fintech hemorrhaged cash and laid off half of its staff.

Other shareholders included CaixaBank, Deutsche Bank, Erste Group, HSBC, KBC, Nordea, Rabobank, Santander, Societe Generale, UBS and UniCredit,

This article represents the views of the author and not necessarily those of the ICC or Coastline Solutions.