$ 23,969
$ 1,893.1
$ 61.87

City Bank executes cross-border Shariah-based blockchain LC transaction

City Bank executed a cross-border Letter of Credit (LC) transaction under a Shariah-based financing arrangement executed using blockchain technology. City Bank has partnered with the International Islamic Trade Finance Corporation (ITFC), the trade solutions arm of the Islamic Development Bank (IsDB) Group, which was both the advising as well as financing bank, according to a press release issued by the bank on Thursday.

The ITFC financed the LC under the Murabaha Trade Finance line with City Bank. The LC was issued on behalf of Debonair Group, a leading Bangladeshi RMG exporter, for import of accessories for garments industries from a Hong Kong-based exporter, Apparel Link (HK) Ltd. The transaction was conducted on Contour’s network, which was built using R3’s Corda blockchain technology.

Processing time for this transaction was extremely short – LC draft initiation to issuance and advising took only 38 minutes compared to the typical 24 to 72 hours required for regular cross-border LCs. Blockchain technology allows parties to manage their own data while transacting and viewing shared information seamlessly and securely with their trading partners and service providers.

This results in transparency in transactions, reducing the scope for forgery and fraud significantly. In addition, as all related parties and clients are members of the network, they can see and share all relevant information without the requirement of visiting the banks in person, a bigger challenge with Covid-19 restrictions.

The ITFC, in this case, advised Apparel Link (HK) despite them not having any physical presence in Hong Kong. The increased efficiency results in a reduction of costs at all ends. “City Bank is the leading digital bank in Bangladesh and is committed to using technology to provide efficient and satisfying experience to our clients.

This transaction will pave the way for improved digital trade through blockchain technology,” said Sheikh Mohammad Maroof, City Bank’s additional managing director. CEO of Contour, Carl Wegner said, “We’re finally seeing the trade finance industry embrace digitization and reap the benefits of improved connectivity and efficiency in LC presentation.

As we continue building the world’s trusted network for global trade, we’re keen to ensure this growing eco-system of banks, corporates and technology providers remains inclusive and accessible for all Agencies

Related Posts

Leave a Reply


Subscribe To Newsletter

For updates and exclusive offers, enter your e-mail below.

Popular Posts

Report Says $1 Billion Lost To Scams Linked To North-Korean Hackers
August 16, 2022By
Nigeria and India To Partner On Development of FinTech, AI
August 16, 2022By
Israeli Police Arrest Suspects Over Multi-million Dollar Crypto Theft
August 16, 2022By


Video Posts

Impact Of Technology On 4.0
July 6, 20210
Importance Of Cryptography
July 3, 20210

Crypto Stats

CryptoCurrencyUSDChange 1hChange 24hChange 7d
Bitcoin23,969 0.35 % 0.59 % 3.30 %
Ethereum1,893.1 0.81 % 0.15 % 11.42 %
Tether0.9991 0.18 % 0.25 % 0.29 %
USD Coin0.9985 0.29 % 0.27 % 0.44 %
BNB317.05 0.24 % 0.78 % 2.60 %
Cardano0.5613 0.29 % 1.37 % 8.73 %
XRP0.3807 0.62 % 1.24 % 3.17 %
Binance USD1.002 0.00 % 0.09 % 0.04 %
Solana43.52 0.65 % 0.25 % 7.48 %
Dogecoin0.08633 1.38 % 9.88 % 24.32 %