The we.trade blockchain consortium has added another founding partner, extending its geographical coverage into the Nordics market.
Nordea joins Santander, Deutsche Bank, HSBC, KBC, Natixis, Rabobank, Société Générale and UniCredit as a we.trade shareholder, becoming the first bank in the Nordic region to deliver a customer-facing trade solution based on distributed ledger technology (DLT) – also referred to as blockchain.
We.trade is a digital platform for managing, tracking and protecting trade transactions between SMEs. It is currently being developed by the founding banks together with IBM, which was selected as the project’s IT vendor earlier this year. Originally known as the Digital Trade Chain, the group later rebranded as we.trade.
The platform will be powered by Hyperledger Fabric 1.0 and harnesses both DLT and smart contracts. It links the parties involved in trade (the buyer, buyer’s bank, seller, seller’s bank and transporter) and registers the entire trade process, from order to payment, displaying it in an at-a-glance, user-friendly interface, and guaranteeing automatic payment when all contractual agreements have been met. The platform is fully automated and available 24/7, making the order-to-payments process quicker than the traditional exchange of documents.
Speaking at a panel at Sibos back in October, the eight shareholders said that the consortium had no plans to grow its shareholders for the time being. Instead, the message was that the group was looking to have as many banks as possible – and as quickly as possible – onboarded to the platform on a licence-type basis.
It seems that by welcoming the Nordic bank as a shareholder, the consortium has changed its mind. But Anne-Claire Gorge, global head of product management, trade services, at Société Générale, tells GTR that Nordea’s “strong interest” in the project dates back several months.
“From the beginning Nordea was willing to be a shareholder,” she says. “It took some time to settle the deal. When we met in October in Toronto it was very well advanced but still confidential. Obviously this was a very good opportunity for the consortium to add the Nordic countries in the scope of the solution.”
At Sibos, the shareholders also announced their intention to establish a not-for-profit joint venture company (JVCo) by the end of the year, in Ireland, to manage and distribute the platform. The JVCo will be co-owned by the now nine founding member banks.
Although backed by the founding banks, the we.trade consortium is an open bank platform available for other “member” banks to join in order to create standardisation, collaboration and consensus across banks to support trade.
“We are currently talking to several banks and offer them to join as member banks. They will have their own node on the blockchain and will be able to give their clients access to we.trade. We’ll create a user group to enable them to contribute to the solution’s roadmap,” says Gorge.
She reiterates her own message from Sibos: “It’s faster and easier to onboard as a member bank. We can’t exclude the possibility to add new shareholders, but we want to stay swift and agile which is not easy with too many shareholders.”
The commercialisation of the platform is anticipated in Q2 2018, while it is expected that test customers of the founding banks will use the platform sooner than that.