UK-based banking giant HSBC is seeking Korean banking partners to expand the R3-backed blockchain platform Voltron to the region.
United Kingdom-based banking giant HSBC is seeking banking partners in South Korea to deploy the blockchain platform Voltron in the country, Korean news outlet The Korea Times reports on Tuesday, March 12.
As reported, Voltron is a platform that enables companies to process and settle their trading invoices via blockchain. The solution was launched in October 2018 by blockchain consortium R3 and eight banks — including HSBC, ING and Standard Chartered — and is currently at the pilot stage.
HSBC's Innovation Director on Blockchain Joshua Kroeker, cited by The Korea Times, says that the company is planning to launch Voltron commercially in the near future. HSBC wants to establish ties with Korean banks to collaborate on the development of the platform and share costs.
Kroeker believes that the decentralized system can significantly reduce the time generally required for interbank operations and facilitate connections. "The biggest impact would be time. Time and transparency will help companies better manage their cash flow and working capital," he told reporters, adding:
"I am here this week to reach out to Korean banks to collaborate on this blockchain platform for letters of credit."
The Korea Times noted that filing and processing trading papers normally takes five to ten days, but can in fact last up to 30 days. As the publication notes, a decentralized system could help reduce this time to 24 hours, as blockchain enables different parties to have access to the data in real time.
Earlier this year, Béatrice Collot, Head of Global Trade and Receivable Finance at HSBC, paid special tribute to blockchain, saying that the technology has the potential to converge the two main ecosystems involved in trade finance — the financial ecosystem, which includes banks and suppliers, and the supply chain ecosystem. She mentioned transparency and instantaneity as the true strengths of blockchain.
In February, HSBC revealed that its proprietary blockchain solution FX Everywhere had cut costs for foreign exchange trade settlement by 25 percent. However, the company clarified that the blockchain-powered settlements represented a small proportion of the total.