Press Release | Singapore and India kick off interoperable eBills of Lading for Trade Finance
25 August 2023
TradeTrust enables interoperable electronic Bills of Lading (eBLs) backed Letter of Credit transactions between Singapore and Indian banks and companies, paving the way to digital cross-border trade
Singapore and Indian banks and companies successfully kicked-off the first live transaction using the TradeTrust Framework, for a shipment between Singapore and Indian businesses. This was announced by Minister for Trade and Industry Gan Kim Yong at the G20 Trade and Investment Ministerial Meeting in Jaipur, India.
The live transaction successfully showcased the digitalisation of cross-border trade financing documentation that can be applied across different systems, aimed at improving the speed, efficiency, and accuracy of information required in shipment transactions. This will result in cost savings for companies and enhance access to trade financing. Globally, this is the first shipment to undergo a fully paperless transaction process involving traders, shippers, and banks. This project was implemented in close partnership between government agencies (Ministry of Trade and Industry, the National Institute for Transforming India (NITI) Aayog, Enterprise Singapore, and Infocomm Media Development Authority (IMDA)) and industry partners (DBS, ICICI Bank, Maptrasco, Jindal Stainless, and A.P. Moller-Maersk).
Minister Gan said, “This TradeTrust project between Singapore and Indian enterprises, banks and a global logistics provider is a big step towards achieving paperless trade, making international trade easier, faster and cheaper, especially for SMEs. The project also demonstrates the real-world applicability of the G20 High-Level Principles on Digitalisation of Trade Documents, particularly Interoperability, Scalability, Data Privacy and Voluntary Sharing of Data.”
B.V.R. Subrahmanyam, Chief Executive Officer of NITI Aayog said, “This joint project of the two Governments demonstrates the efficacy of using blockchain in place of existing paper-based cross border trade finance. It underlines the importance of addressing governance challenges while adopting new technologies in real-life use cases.”
Pioneered by the IMDA, TradeTrust is designed to address the challenges of paper-based cross-border trade. It utilises a blockchain-powered technology which ensures singularity and provenance in the transactions, resulting in greater trust, security, and accuracy. TradeTrust is also based on international standards and is thus interoperable, allowing different systems to participate in the framework.
Following this first shipment, businesses in Singapore and India keen to execute eBLs in Letter of Credit transactions can reach out to DBS and ICICI Bank. For other trade documents and scenarios, they can approach IMDA (TradeTrust@imda.gov.sg).
Details of First Shipment Using the TradeTrust Framework
How the shipment is being conducted:
Maptrasco shipped a container of scrap metal from Miami to Gujarat.
Maersk issued an electronic Bill of Lading (eBL) using the TradeTrust portal, a reference implementation of the TradeTrust framework, to Maptrasco.
Simultaneously, Jindal Stainless applied for a Letter of Credit (L/C) from ICICI Bank as the Issuing Bank of the LC.
Maptrasco, which utilised DBS as the Presenting Bank, transferred the title ownership of the eBL via the TradeTrust portal.
DBS checks and confirms the supporting documents as per the terms of the L/C, including the TradeTrust eBL. Once the documentary checks are completed, DBS uses SGTraDex platform to transfer the title ownership of the eBL to ICICI Bank.
ICICI Bank receives the eBL, alongside the other trade finance documents as per the terms of the L/C from DBS and uses its own proprietary platform, TradeChain powered by EdgeVerve which is TradeTrust-enabled by GUUD to transfer the title ownership of the eBL to Jindal Stainless.
Jindal Stainless as ICICI Bank’s customer, utilises the TradeChain platform to surrender the eBL to Maersk and complete the shipment.
Maersk then issues an electronic Delivery Order (DO) for Jindal Stainless to collect the cargo at the port of discharge.
See the full press release on IMDA's official website.