The Marco Polo blockchain platform for open account trade finance has been released, and the consortium behind is now inviting new participants to join.
Marco Polo is an initiative to develop an open account trade finance platform powered by blockchain technology. It aims to enable real-time connectivity between trade participants, improve visibility into trade flows and simplify access to credit and risk mitigation services throughout the trade lifecycle.
The platform is built by TradeIX, R3 and a group of banks on the Corda blockchain framework, using TradeIX’s open-source tools to test, pilot and manage open account trade finance transactions.
The announcement was made at the CordaCon London event on September 13, where Rob Barnes, co-founder and CEO of TradeIX, gave the audience new insights into the project’s timeline.
Despite battling a few technical challenges, CordaCon saw Barnes showcase a live demo of the Marco Polo platform, which he said would be released on September 17, followed by a training day with the banks on September 18.
The banks involved in the project at this point are Bangkok Bank, BNP Paribas, Commerzbank, DNB, ING, Natixis, Natwest, OP Financial Group, SMBC and Standard Chartered.
ING, BNP Paribas and Commerzbank were the core banks driving the proof of concept, the completion of which was announced earlier this year.
The first product, which is now live on the platform, is receivables discounting, which the banks will start piloting on October 22, at which point the “final release” of Marco Polo will be ready. Factoring will follow “soon after”, Barnes said.
Banks will complete different pilots depending on their specific focus within trade finance.
“We wanted to get to a point where the corporates don’t have to go to different portals for different services. We think we are achieving that,” Barnes said, adding that Marco Polo will “give customers – whether they are a five-man organisation or a Fortune 100 company – the ability to run and manage working capital based on what they need, where they need it and across the network”.
The platform is expected to be commercialised next year.
A number of other financial institutions, including Barclays, BBVA, Bladex and Wells Fargo, were part of the original consortium developing the proof of concept, but then decided to leave the project.
“We needed the banks to help us pay for this,” Cotti told GTR recently. “And some of the banks had too many other projects or didn’t have the budget, or weren’t able to present a business case internally that was approved.”
The main focus of the Marco Polo initiative will now be to add new bank members. In its second stage, other participants in the trade ecosystem will be invited to join, including credit insurers, B2B networks, logistics companies, service providers and payment networks.
“The ecosystem with Marco Polo is really starting to expand. We will now be opening for new participants,” Barnes said.
The banks will have flexibility in how they implement the platform, he added. A bank can deploy it either “on-premise” or as a platform as a service (PaaS). A software as a service (SaaS) model will be available for small banks at a later stage.
The announcement comes just a few months after TradeIX announced it had closed a series A funding round, receiving a US$16mn investment from ING and other financial players. At the time, the firm called the investment “a significant stepping stone”, which would allow it to “accelerate resources to the Marco Polo project” and grow the ecosystem “aggressively”. Following the investment, TradeIX has also opened a Singapore office.
Apart from Marco Polo, a range of other projects are currently being carried out using TradeIX’s open-source blockchain platform, which allows financial institutions to develop their own trade finance applications with open APIs.
Earlier this month, Standard Chartered announced it was kicking off pilots for blockchain-based guarantees together with Siemens and TradeIX. The bank has also used TradeIX’s tools to build a blockchain invoice financing platform for DHL, together with insurer AIG. Now implemented by the logistics company, the solution helps its customers extend their payment period whilst maintaining the company’s receivables at current terms.