Thailand Blockchain Community Initiative (BCI) has joined hands with IBM to extend the scope and reach of the blockchain-powered electronic letter of guarantee (eLG) platform to businesses of all sizes. Since its inception in late 2019, the platform has handled guarantee letters worth nearly $300 million.
Time is of the essence
The eLG platform’s popularity is founded on the slashed timeframe of less than a day it uses in the issuance of guarantee letters if a buyer defaults. The manual process takes commercial banks in Thailand approximately nine days because of the negotiations between the buyer, seller, and bank. As per the announcement:
“The platform went live in late 2019 and currently handles an approximate value of US$ 300,000,000 in guarantee letters. It has proven to reduce letter of guarantee issuance time to less than a day.”
The seller might also find him/herself at a fix without recourse because the manual procedure faces the danger of forgery of paper documents. The BCI blockchain platform has stepped in and averted these predicaments because 22 banks and 15 companies presently utilized it for enterprise auctions, payment obligations, and other domestic trading processes.
Through the new partnership, more capabilities like disaster recovery and multi-region high availability will be availed. Others are hybrid cloud and multi-vendor abilities.
Transaction costs reduced by 200%
Reportedly, the eLG platform is designed to minimize the likelihood of fraud and errors for all parties involved. As a result:
“Some member companies report seeing a 200% reduction in transaction costs.”
The BCI sees the letter of guarantee as just the first service offered by the eLG blockchain platform as more products are scheduled to be added in the near future. This is because it is aligned with the roadmap of utilizing a hybrid deployment model for global expansion. Silawat Santivisat, the chairman of the BCI board, noted:
“Blockchain is the key enabler for multi-industry connectivity platforms. Blockchain allows businesses to rethink processes and inefficiencies, and with the right partners and technology platforms providing scalability, security, and multi-cloud capabilities, these networks can grow efficiently across environments and regions.”
Last month, Thailand’s Central Bank, the Bank of Thailand, leveraged the power of blockchain technology to launch a platform for government bond savings issuance. It noted that the blockchain-based platform would improve investor’s buying experience, boost operational efficiency, and reduce the overall cost of operations.
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