Blockchain can help the trade finance industry prevent billion-dollar scandals and ease trade financing, says expert.
The pressure induced by the ongoing economic crisis, obsolete trade finance systems and mounting geopolitical tensions is pushing the international trade finance industry down a rabbit hole.
To add to the already critical situation, recent trade finance scandals involving major players such as Hin Leong, ZenRock, Agritrade and Hontop Energy amounted to a loss of almost $6 billion that was mostly borne by banks.
To limit their exposure to such threats, major banks like ABN Amro, Société Générale and BNP Paribas have withdrawn completely from this sector while others have raised the bar on their funding processes, said Samir Neji, founder and CEO of blockchain-based trade finance company dltledgers.
Neji told Cointelegraph, "For traders and other businesses moving goods around the world, working capital is now much harder to come by.