A shipment of flat carbon steel to the UAE from India has become the first integrated paperless letter of credit (LC) and electronic documentary transaction for a steel export, according to HSBC, which financed the trade.

The live trade finance transaction between the UAE’s Universal Tubes and Plastic Industries, and India’s Tata Steel, involved end-to-end digitisation of the documentation on blockchain trade finance network Contour. essDocs, a Contour partner, managed the electronic bill of lading (eBL) and other documentation through its CargoDocs service.

HSBC says that this transaction is an example of the operational viability of blockchain as an alternative to conventional exchanges of paper-based documentation.

“We are delighted with Universal Tubes’ and Tata Steel’s decisive action to conduct this trade over Contour, which reinforces the commercial and operational viability of blockchain and the Contour platform,” says Sunil Veetil, regional head of global trade and receivables finance (GTRF) at HSBC Middle East, North Africa and Turkey. “We are confident this will pave the way for widespread adoption by other clients, counterparties and industries, many of whom we are already in talks with.”

While the physical transfer of goods between the UAE and India takes a relatively short time due to close proximity, the administrative paperwork can often impede delivery. By digitising these processes, transaction times can be reduced from five-10 days to under 24 hours, unlocking working capital and enabling more trade to be done between countries.

“The future of trade is digital and the success of this blockchain transaction encourages us to look forward to linking all our future letter of credit transactions to this solution,” says Anil Taurani, managing director of Universal Tubes and Plastic Industries. “The speed, visibility, efficiency and enhanced security it offers is a tremendous advantage and opens up immense opportunities for us. Despite the involvement of multiple players, we found the entire experience seamless and transparent.”

The is the latest in a series of firsts for the Contour platform, which left beta and entered full commercial production in October last year. Owned by eight shareholder banks – Bangkok Bank, BNP Paribas, CTBC, HSBC, ING, Standard Chartered, SEB and Citi – Contour’s blockchain solution has most recently been pressed into service for the first paperless renminbi (Rmb)-denominated deal in the iron ore industry, as well as for the first cross-bank LC between Vietnam and Thailand completed using a blockchain platform.