The People’s Bank of China secured $4.7 million in funding for its blockchain trade finance platform

By Selena On Mar 9, 2020

A Blockchain trade finance platform led by the People’s Bank of China (PBOC), the country’s central bank, has received special funding for critical research and development projects. In total, this grant amounts to 32.35 million yuan ($ 4.7 million). The funding will be administered over three years and has been designated for research and development projects.

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China’s central bank Blockchain trade platform gets $4.7m funding

The Blockchain trade finance platform in Shenzhen, Guangdong province of South China, was launched in September 2018. Inputs on the platform of businesses cannot be modified, and the banks involved Can share information with other departments.

The number of banks and companies participating in the platform has continued to increase after launch. By mid-January, the platform linked 44 banks and 1,898 companies. Accordingly, the platform handles more than 90 billion yuan in transactions every day.

Blockchain drives efficiency savings for Chinese corporate financing

Industry insiders note that sponsorship will help promote the development of the Blockchain trade finance platform. This is the highest level, and most supported Blockchain project at the national level. The central bank is expected to share safety and security information and make it easier for small and medium-sized enterprises (SMEs) to access more financial instruments during the COVID-19 pandemic.

According to media forecasts, the commercial finance project has been promoted and coordinated by parties such as PBC’s Digital Currency Research Laboratory, major domestic, commercial banks, and the Academy of Sciences. China and local universities such as Tsinghua University.

Wu Hao, an independent analyst based in Shenzhen, said:

“In such a context, promoting the advancement of the commercial, financial platform will play an essential role in helping the effectiveness of interbank transactions, as data can be shared between participants through the distributed network.”

The platform has dramatically improved the effectiveness of small and medium-sized enterprise loan approvals. In essence, the time needed to process trade finance has been shortened from more than ten days to about 20 minutes. Corporate finance costs have also dropped below 6%.

Blockchain has been actively deployed for the growing number of applications across Chinese society in recent months. On March 2, Beijing launched a Blockchain-based electronic invoice system for parking. Beijing’s tax authority says it will gradually deploy Blockchain invoices on all city car parks to promote paperless invoicing. At the same time, they said they plan to use Blockchain invoices in many fields in the future.

In the first half of February, it was estimated that at least 20 Blockchain applications were launched to support the Chinese government’s efforts to prevent Coronavirus – including managing and tracking health records and supplies medical and relief efforts.

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