Blockchain in financial services

Making blockchain technology real for business owners

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There’s no shortage of internet videos featuring blockchain experts speaking on panels and in front of whiteboards. But what does blockchain actually look like when it comes to life in the real world?

That’s what we set out to show in this new video about we.trade. It’s the trade finance network convened by IBM Blockchain that’s reducing risk and increasing opportunity for small and medium-sized enterprises (SME) and the institutions serving their trade finance needs across Europe.

Members of we.trade have been using it to execute real transactions since July 2018. So we talked to two of its earliest adopters to learn about their experiences: Magnus Montan, Head of Business Banking at Nordea, and one of his clients, Ismo Nironen, Head of Financing and Risk Management at Flowrox, an industrial pump and valve manufacturer.

Open new corridors of trust for new trading partnerships

Our video shoot took us to Nordea’s offices in Stockholm, Sweden, and Flowrox’s headquarters in Lappeenranta, Finland. What we discovered during filming is that we.trade is fulfilling its transformative potential of injecting more trust into trade — and at a critical moment.

Approximately 80 percent of trade today relies on credit or guarantees. Yet institutions managing trade finance are shackled to an outdated, error-prone system that increases their operational risk and costs, while impeding their ability to serve the needs of smaller clients. That last challenge is borne out in the fact nearly 60 percent of SME trade finance requests go unfulfilled. The resulting $1.5 trillion trade finance gap serves as a major roadblock in optimizing trade worldwide.

A blockchain platform where users don’t need to know blockchain

The end-to-end transparency offered by the we.trade platform can rectify many of these issues. Buyers and sellers can find each other through a matching engine of pre-approved, bank-verified participants. They can then draft trade proposals governed by a standardized set of trading rules, rely on smart contracts to execute financing and payment activities, and more. As Magnus aptly puts it from his perspective at Nordea, “we.Trade is not only about providing trade finance. It’s something much bigger than that. It’s actually about enabling trade.”

Ismo echos this sentiment. Flowrox has long sought out ways to efficiently expand into new markets, relying on the knowledge and connections of a network of contracted regional sales agents. He believes the platform may soon find its place in their arsenal. “Recently we have begun investigating whether we could utilize we.trade with our small agents in South America. This can expand our strategy of growth and being everywhere in the world.”

Interestingly, we.trade’s ease of use may also turn out to be one of its biggest benefits. Even though the IBM Blockchain Platform runs through the heart of we.trade, Ismo says, “I didn’t need to know anything about blockchain” in order to use it.

Hearing Magnus and Ismo talk about their experiences — and their satisfaction — elevates the conversation about blockchain from the theoretical to the real. Stepping away from panels of experts and whiteboards, blockchain for business is most definitely real and most definitely delivering transformative results. We look forward to documenting more stories and use cases from users of networks and solutions built on the IBM Blockchain Platform soon.

Deploy the IBM Blockchain Platform across multiple environments

IBM Blockchain Creative Content Director - Copy IBM Industry Platform

Jose Fernandez

Creative Content Director - IBM Industry Platform

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