China’s central bank, the People’s Bank of China (PBOC), has processed 30 billion yen (US$4.36 billion) in foreign exchange transactions using its blockchain trade finance solution.
As reported by Cointelegraph, the platform is supported at 483 branches of 28 banks in the city of Shenzhen, and is currently operating as normal. Nevertheless, business volume is reported to still be relatively small, owing to allegedly uneven adoption of financial technology.
According to central bank representatives, blockchain technology avoids the hassle of slow paper trails that are typical of trade finance conducted in traditional banking systems.
On July 4, 2019, the PBOC’s Shenzhen Municipal Central Bank Branch signed a strategic cooperation agreement with the Shenzhen Taxation Bureau of the State Administration. The agreement was aimed at realizing automatic tax filing in the central bank’s trade finance blockchain platform.
In September 2018, the PBOC officially launched the testing phase of the platform, known as the “Bay Area Trade Finance Blockchain Platform”. The intention was to facilitate trade and financing activities, including accounts receivable. It would also provide a regulatory system for trade finance to allow for real-time monitoring of financial activities.
The Shenzhen Fintech Research Institute, which was jointly organized by the PBOC in collaboration with local government bureaus, posted openings in May for several blockchain-related positions.
More recently, a report by Big Four audit and consulting firm Deloitte claimed at the end of June that as much as 73% of Chinese enterprises consider blockchain to be among their top strategic priorities.
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