Emirates NBD has signed a memorandum of understanding (MOU) with the Dubai chamber of commerce and industry to provide trade finance solutions for the emirate’s Digital Silk Road project.
The Digital Silk Road is a smart platform being developed by Dubai Chamber in co-operation with port operator DP World and Dubai customs, and is expected to go live in 2020. It aims to improve the transparency and efficiency of supply chains through a “comprehensive automation process”, which will use blockchain technology that helps surpass current trade barriers such as high costs, lack of transparency, diversification of legislation and lack of security in business transactions.
This comes after the bank launched a new supply chain and trade finance portal to enable clients to apply for financing digitally. The portal, called smartTrade, allows Emirates NBD’s transaction banking clients to submit all trade requests online, including letters of credit, guarantees and trade loans. According to the bank, it will reduce the paperwork required as well as shorten turnaround time.
Hamad Buamim, CEO of Dubai Chamber, describes the agreement with the bank as a “major step forward” for the Digital Silk Road. “Trade finance remains one of the most important tools used today to facilitate international trade and commerce as it simplifies transactions for importers and exporters,” he says.
Speaking on the signing of the agreement, Hesham Abdulla Al Qassim, managing director of Emirates NBD said: “Emirates NBD is pleased to partner with Dubai Chamber as part of our shared commitment to harness innovation to enhance and boost trade finance in the UAE. Emirates NBD was the first in the region to successfully pilot a blockchain use case for trade finance and we look forward to lending our expertise and support to the Digital Silk Road initiative.”