BNY Mellon Uses Blockchain To Digitize Working Capital Solutions

blockchain jan27 05oct21 lt

Bank of New York Mellon Corp., commonly known as BNY Mellon, has joined the Marco Polo trade finance network to use the platform's distributed ledger technology (DLT) for providing improved international trade finance and working capital solutions for its customers.

The network allows members to offer and access a complete suite of trade and working capital solutions. It will help in reducing the handling of physical documents, reconciliations and resultant dispute settlements.

BNY Mellon intends to replace the costly and inefficient paper-based systems to conduct trade with the blockchain-powered trade financing platform Marco Polo. Previously, customers had to rely on an antiquated paper and email-based workflow to secure trade financing.

The network connects banks, corporates and third party service providers, powered by enterprise software firm R3's Corda blockchain platform and the distributed trade finance platform from Irish technology firm TradeIX.

The Marco Polo Network is a consortium of about 45 global banks and financial institutions that provides an open software platform for trade, payments and working capital financing to banks, corporates and other market participants.

On joining the cloud-based network, BNY Mellon is now able to more efficiently insert liquidity into the international supply chain, providing supply chain finance solutions including both payables financing and receivables discounting to suppliers shipping goods and services to their buyers around the world.

The use of blockchain offers real-time visibility significantly speeds up the trade finance workflow. The moment the parties agree that the transaction terms are correct, the trade is confirmed in real time. The data in trade documents are checked, matched and confirmed by the parties near instantaneously, enabling the faster delivery of working capital to finance the trade by liquidity providers like BNY Mellon.

This is the latest move in BNY Mellon's drive to expedite the paper-to-digital journey and make payments and trade more efficient for clients. Last month, the firm announced that Verizon has become the first client to rollout Real-Time E-Bills and Payments to customers.

Launched in 2017, Marco Polo is a bank focused network of platforms offering ERP-embedded trade and working capital finance applications to their corporate clients. It is powered by open Application Programming Interfaces (APIs) and Corda blockchain technology.

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