TradeLens, a digital platform launched by IBM and AP Moller-Maersk, has completed its first end-to-end paperless trade finance transaction.

The deal, which involved the shipment of agrichemicals from South Korea to Bangladesh by Syngenta, was financed with a letter of credit from HSBC.

All associated documentation was shared among the parties via the TradeLens platform. Digitised documents included the electronic bill of lading (eBL) directly from the ocean carrier Sealand, the commercial invoice, packing list, certificate of origin and certificate of analysis, as well as the bank collection documents and the bill of lading, all underpinned by blockchain and visible to permissioned parties as soon as they were uploaded to the platform.

This process knocked 10 days off the usual document processing lead time for Syngenta, and helped avoid extra costs due to delayed paperwork, such as potential destination detention and demurrage costs, TradeLens says.

“Trade between proximate markets is often encumbered by paperwork, leading to delays and higher costs. Removing paper from the process should not only increase the efficiency and velocity of trade, but also enhance the appeal of the letter of credit as a trade finance solution by minimising documentary complexity,” says Sanjay Tandon, HSBC’s regional head of product management, global trade and receivables finance for Asia Pacific.

This transaction marks an expansion in focus for the TradeLens eBL, which has thus far been targeted towards the shipping industry. Aside from Maersk, its ocean carrier members include Alianca, CMA CGM, Hamburg-Sud, MSC, Seaboard, Safmarine, Sealand, SPL and Zim. It also counts numerous terminals, inland depots, customs authorities and intermodal providers among its members.

“There are simpler scenarios where there is just the shipper, or the shipper and their consignee involved – sometimes called telex release and straight consignments respectively. Those were our launch scenarios, as the dependencies for getting up and running are fewer,” Daniel Wilson, head of strategy and operations at TradeLens, tells GTR. “We now support trade finance transactions, as we have growing bank support and have proven the ability of the TradeLens eBL to support these transactions.”

He adds that TradeLens is now “actively exploring” partnerships with banks and third-party platforms to create a fully integrated experience for customers, combining digital LC or other instrument issuance through to final payment and release of cargo.