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China-based CITIC Bank launches a new system to settle credit that uses a Blockchain technology-based electronic transmission system.
China-based CITIC Bank will launch a new system to settle credit that uses a Blockchain technology-based electronic transmission system.
Also known as BCLC, the transmission network promises more efficient credit operations by transmitting messages within seconds. This is the first ever letter of credit system in the banking industry built with Blockchain technology.
BCLC optimizes the traditional banking system and improves services including opening letters of credit, pay orders and acceptance messages. It also enables buyers to connect with banks on the network to allow full transparency in banking transactions such as issuing, notifying, accepting and paying.
BCLC has altered the way banks transact and transform into an electronic format, saving time and delivery costs.
The network allows both buyers and sellers to trace the letter of credit path and eliminates the chance of fraud and system errors. The banking sector sees this as a game changer in user experience and banking operations.
The launch comes after CITIC president Sun De-Shun’s order to create a network between Chinese banks to fast-track the application of Blockchain technology into the banking business. This prompted a partnership between CITIC and Minsheng Bank to launch China’s first Blockchain-enabled credit application.
The two banks have polished agreements on confidentiality and legal provisions, as well as overall standards for the use of Blockchain technology.
On the first day, a 100 mln letter of credit transaction was conducted on the system, marking the successful attempt of domestic banks to break the constraints of a traditional banking system.
After the success, CITIC bank said that it will work harder to improve the services offered in the Blockchain-based system and expand the scope of applications by conducting more research and tests to make the technology more efficient.
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