Main Vietnamese financial institution HDBank has now grow to be the primary financial institution within the nation to subject letters of credit score, or L/C, utilizing blockchain expertise.

In response to a Jan. 6 report by native media outlet Việt Nam Information, the issuance, doc presentation and profitable fee of L/C on the blockchain marks a significant milestone on HDBank’s acknowledged objective, to grow to be a “Completely happy digital financial institution”.

The contributors within the first transaction have been a neighborhood fiber importer and a Taiwanese yarn producer, together with the L/C advising financial institution in Taiwan.

Letters of credit score are vital paperwork in worldwide commerce, offering a assure from a creditworthy establishment, reminiscent of a financial institution, {that a} purchaser’s fee to a vendor shall be obtained on time and for the right amount. In essence, the financial institution underwrites the fee.

Utilizing blockchain expertise for L/C has many benefits, reminiscent of providing the next stage of safety and a everlasting document of the transaction. It additionally reduces the time wanted to course of such transactions to a matter of hours.

HDBank joined the HSBC-backed Contour community for L/C again in Could 2020. As Cointelegraph reported, the R3 Corda-based platform obtained a business launch in Q2 2020, following a profitable trial in 2019.