Commerzbank step up to work with the Fraunhofer-Institute for Material Flow and Logistics in Dortmund. The company says new concept is based aroundIoT and smart contracts.
Commerzbank says new concepts in digital trade finance based around distributed ledger technology, IoT and smart contracts constitute the basis for new trade ecosystems, new supply chain finance concepts, faster transaction processing and new solutions in working capital management.
Bernd Laber, group executive trade finance & cash management corporate clients, Commerzbank, comments: “We are working on several projects and in a number of consortiums also with other international banks on the digitisation of bank products and bank services, and on applications for blockchain technologies. As a corporate bank the focus on future supply chains of our customers is of paramount importance and we will develop this in co-operation with Fraunhofer Institute.“
A new report from the International Chamber of Commerce, finds that 50% of banks expect most of trade flow processes to be digitised by 2027 – while an almost equal portion expect the evolution to take from 10-25 years. In addition, nearly 44% of the 225 respondents from 98 countries identify digitisation and technology as priority areas of focus.
However, while there is optimism with respect to the potential of new technology, only 12% of respondents perceive a degree of market uptake and nearly 40% see limited progress in this area – with almost 18% reporting that technical capabilities and digital technology are ahead of trade finance business practice, the ICC reports.
Michael Henke, director of the Fraunhofer Institute for Material Flow and Logistics (IML), is undeterred: “I am convinced that technologies like blockchain and smart contracts will become the central enabler for the intelligent interlinking of physical and financial supply chains. With Commerzbank as innovative cooperation partner we will elaborate new, fast and secure solutions for the supply chains of the future.”