HDBank of Vietnam has processed its first blockchain letter of credit (L/C) transactions since joining the Contour blockchain trade finance network last year (DC World News, 19 June 2020).

The bank, which joined the network to increase its ability to extend trade financing to more corporates, says its first transaction over the Contour platform took just two hours to complete.

L/C details

Participants in the transaction were Vietnamese yarn importer Century Synthetic Fiber Corporation and Taiwanese yarn manufacturer Tainan Spinning.

HDBank was the L/C issuing bank while CTBC was the L/C advising bank in Taiwan.

Blockchain benefits

Benefits of blockchain compared with traditional L/C transactions according to HDBank, which one of the few Vietnamese banks that can confirm L/Cs issued by foreign banks, include a significantly shortened transaction time of just 2 hours or so.

Other benefits according to the bank include higher security, less time and fewer paperwork requirements, reduced processing errors and increased storage capacity for statistics and transaction histories of partners and customers.

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