Russian Alfa-Bank Is The First Bank To Sign Contour International Trade Finance Network
Russian Financial Institution (FI) Alfa-Bank - one of the largest private commercial banks in Russia has become the first Russian bank to join Contour International Network of Trade Finance according to an official announcement on Nov. 3.
Contour is a blockchain trade finance network backed by HSBC connecting the world’s major financial institutions like HSBC, ING, and Citi, allowing bank’s clients to track the processing and modification of trade finance transactions live via blockchain and cutting operational costs. The process of issuance of a letter of credit involves plenty of documentation and takes too much time but with Contour’s network, the processing time of LC issuance can be reduced by as much as 90% to one full day from 10 days as per the announcement.
“The accession to the Contour platform and launch of the pilot projects on the Russian market will fine-tune the strategy of development of products for transborder transactions. Customer requests become more complex, and we are always seeking to offer the best solutions.” Evgenia Fomina, head of the Alfa-Bank lending directorate
“Alfa-Bank marks yet another step forward for Contour, being the first Russia-based bank on our network. Their involvement will continue to build an inclusive network that will improve trade across the globe,” Contour CEO Carl Wegner in the announcement.
Contour international network of trade finance interconnects different trade companies and banks such as issuing banks, applicants, beneficiaries, nominated/confirming/advising banks, and other parties involved in the LC process to ensure a fast, reliable and transparent process of drafting, and issuing letters of credit. The corporates dealing in international trade finance are more prone to get significant benefits from this initiative by Alfa.
The founders of Contour include major banks like HSBC, BNP Paribas, Standard Chartered, and ING willing to boost the LC workflow & settlements as well as to reduce operational costs. Contour uses R3 Consortium’s Corda blockchain infrastructure and joined forces with Mphasis in October to boost the digital transformation of international trade finances.
Despite the project being started two years ago, it finally went live last month. Earlier in October, it was also announced by Contour to consider live production to connect buyers, suppliers, and financial institutions on a decentralized electronic trade finance infrastructure.