The Voltron bank consortium will soon be piloting a new electronic bill of lading capability on its blockchain platform, having partnered with essDocs.
It is the second e-bill of lading provider that Voltron is collaborating with, following a number of pilots with Bolero last year.
Voltron is a blockchain application to digitalise the letter of credit process. It is built on R3’s Corda framework and run by a consortium of eight founding members: Bangkok Bank, BNP Paribas, CTBC Holding, HSBC, ING, NatWest, SEB and Standard Chartered.
Since May last year, the members have been live testing the solution in different industries and markets. In November, a pilot by HSBC and ING saw the first integration of an electronic bill of lading, provided by Bolero.
Voltron members have long been open about wanting to partner with other providers, with Chris Sunderman, blockchain initiative lead for trade finance services at ING, previously mentioning the likes of essDocs and eTitle as prospect partners.
“We need to incorporate other solutions to make the lives of our clients as easy as possible,” he told GTR in November. “When you look at the trade ecosystem, the world is large, and companies do not per se work with one provider of e-documents. So within project Voltron, the banks agreed to investigate and analyse the application of other solutions as well.”
essDocs, meanwhile, announced in December that it was moving into the blockchain space.
The new partnership will see the firm implement its CargoDocs DocEx to the Voltron application, enabling banks and corporates to access CargoDocs data when executing a Voltron-based letter of credit.
According to essDocs, over 6,000 exporters, traders, importers, shipowners, ship agents and independent inspectors use its CargoDocs DocEx solution.
Work on the CargoDocs-Voltron integration is already underway, with the connection slated for completion in Q2 2019. It will be followed by a series of trials.
Samuel Mathew, global head of documentary trade product management at Standard Chartered, says the partnership marks “another milestone for Voltron”.
“This takes us one step closer to a common blockchain-based letter of credit platform integrated with electronic bill of lading capabilities and connectivity across banks, corporate and third-party providers,” he says.
So far, the Voltron platform has facilitated five live pilots, involving HSBC, ING, BNP Paribas and Bangkok Bank.
Speaking to GTR earlier this week, Joshua Kroeker, blockchain lead for global commercial banking at HSBC, said that the remaining member banks are currently identifying clients and are expected to start live testing throughout 2019.
The consortium is also looking to establish an independent company by the end of the year that can bring Voltron into production. This is a similar approach to other blockchain consortia, such as we.trade and komgo, which are run by independent legal entities created by bank shareholders to own and operate the platforms.
“A couple of things need to happen before we launch Voltron as a commercial solution,” Kroeker said. “The first is the creation of a new company – a neutral entity that will own and operate the platform on behalf of its users. And then also deciding what is going to be our commercial launch strategy.”
The Voltron tests have covered a range of sectors, including soybeans, plastic derivatives, metals and now wool. The next pilots will continue to explore different industries and countries, identifying and evaluating potential go-live markets, Kroeker explained.
“The letter of credit is such a huge product that is used around the world. So you need to have a focused approach: where are the most important markets and where do we have the highest chance for success? That’s what we’re looking at right now, and every time we do one of these tests, it’s a very good test of that market,” he said.
Kroeker further hinted that more e-bill of lading partnerships could follow.
“We are open to all electronic bills of lading,” he said. “Whatever the shipping industry chooses and takes as the most appropriate tool for them, we will want to make sure it’s fully integrated into the flows of Voltron.”