The Vietnamese HDBank has announced that it will use the blockchain to start offering letters of credit. It would be the first in the nation to do so, the significant financial institution says.
A Vietnamese financial institution is stated to be initiating the provision of blockchain letters of credit (L/C) aimed at better and safer transactions for its customers.
Turning into a “happy digital bank.”
Vietnamese bank HDBank has announced it will use blockchain technology to issue letters of credit (L/C). According to a recent study, by being the first in the county to deliver the L/C using blockchain technology, the critical financial institution will pioneer the local digital market.
A letter of credit is similar to a bank letter, which ensures that payment to a seller by a buyer will arrive at a pre-determined time and amount.
HDBank has accomplished the issuance, presentation of documents, and sufficient payment of credit letters on the blockchain network, thus marking “a new milestone” in its mission of being a “happy digital bank.” The institution will provide its customers with excellent L/C transaction methods and blockchain technology on a trial basis.
Leading fiber importers Century Synthetic Fiber Company and Tainan Spinning Co. are vital participants in the project. Ltd., a significant producer of Taiwanese yarn and an exporter. CTBC, the L/C advising bank in Taiwan, will also be part of the team.
Blockchain-based L/C transactions provide users with higher protection compared to conventional methods, according to the report. They manage to reduce the processing time of transactions, eliminate both paperwork and the probability of future mistakes, etc.
The letter of credit will include a guarantee to the receivers, based on the blockchain technology and HDBank’s partnership with central banks and institutions worldwide. It produces trouble-free transactions plus an instant flow of accurate and secure information.
Banks planning for additional blockchain adoption
Blockchain and cryptocurrencies have managed to draw the attention of several institutional-level businesses worldwide, even if they are still barely embraced by conventional banks. Another global financial institution has demonstrated a leap of confidence in adopting cryptocurrencies and blockchain, as CryptoPotato stated. DBS Bank of Singapore has shown its confidence in the nascent technology. After going through a questionable phase, followed by a soft-launch, now its own DBS Digital Exchange crypto exchange is a reality.
The initiative, which has already been launched, focuses on its institutional clientele. The platform seeks to leverage blockchain technology to provide “via asset tokenization plus secondary trading of digital assets, including cryptocurrencies,” an ecosystem for fundraising.
Three essential utilities will deliver the latest endeavor:
- Security Token Offerings (STOs), which enable the issuing and trading of financial asset-backed digital tokens.
- Four fiat currencies (SGD, USD, HKD, and JPY) spot cryptocurrency exchange and selected cryptocurrencies, including Bitcoin (BTC), Ethereum (ETH), and Bitcoin Cash (BCH).
- Digital Custody Services, “an institutional-grade digital custody solution to meet the increasing demand for secure custody services tailored to their existing regulatory standards for digital assets.” For this particular service, the platform would leverage the expertise of DBS.