HSBC México carried out its first transaction using blockchain technology by issuing a letter of credit for the import of Grupo Charly products from Hong Kong. Originally from León, Guanajuato, sportswear and sports shoes company, Grupo Charly, conducted its first international trade operation with a letter of credit via blockchain at HSBC Mexico.
According to the HSBC statement, it was a single pilot operation with the innovative technological platform that the financial institution hopes will be ideal in the future for companies to conduct import and export operations and who want to streamline their processes.
“The letter of credit was selected for the pilot because it is a basic means of payment for foreign trade. It acts as a bank’s obligation to pay so that two parties who wish to do business can do so safely. “The statement is.
It should be noted that the transaction took place on October 26th, when HSBC México issued Grupo Charly’s letter of credit. Subsequently, on November 2nd, the presentation of the documents took place, which was accepted in less than 24 hours. The transaction was closed on November 3rd.
In addition, the bank announced that the entire operation was completely handled by them, i.e. HSBC Mexico issued the letter of credit for the importation of Grupo Charly products from Hong Kong, and HSBC Hong Kong issued the letter to the companies in that country for the subsequent shipment of goods to the United States.
“Everyone involved in the operation used the digital platform Contour, which was used by HSBC Holdings and other international banks and through which the buyer, seller, HSBC Mexico and HSBC Hong Kong could view, validate and authorize the letter of credit. This made buying and selling possible from Grupo Charly and reduced the time required for a traditionally developed company of this type. “
HSBC Mexico is very happy to integrate blockchain technology
“We at HSBC México are very proud to have carried out this first blockchain pilot with Grupo Charly. Without a doubt, this technology creates a new dynamic in the processing of digital information through a letter of credit. “ said Diego Spannaus, regional director for foreign trade and factoring at HSBC Mexico.
HSBC Holdings plans to conduct the first commercial operations using blockchain technology from 2021. Since 2018, 17 successful pilot operations involving different countries, banks and productive sectors have been carried out. Mexico is number 18.
They also hope from the company that this technology will enable them to lower their cost per operation while also offering other benefits such as speed. With the advent of modern technologies like the Internet of Things, Artificial Intelligence and Blockchain, new opportunities are emerging to improve the efficiency, transparency and interoperability of the retail ecosystem.
Blockchain has the potential to solve various problems with a single window and improve the efficiency and capabilities of border authorities. However, the benefits depend on the accuracy of the implementation.