Bank of America has been working on a prototype distributed ledger system to modernize trade finance. This project is another example of the bank’s effort to gain a foothold in the rapidly ballooning financial innovation movement. Bank of America also filed paperwork for 20 blocking patents at the start of 2016.
According to an FT article, Jason Tiede, Head of Innovation for Global Transaction Services at the Bank of America, said that the project is being developed in partnership with another “yet unnamed” financial institution.
Tiede says that blockchain tech may solve the slow and time consuming process of trade finance:
“We are working on a pilot in the trade finance space. As trade finance often relies on manual, paper-based processes, it serves as an interesting use case of the value of digitising an asset on a distributed ledger.”
He mentioned that the pilot program may be ready for testing by late spring. BofA is also part of the R3 blockchain consortium, which is backed by 40 of the world’s largest financial institutions.
Tiede also said that this particular pilot program is being developed in private, and that this experiment is separate from other projects BofA is currently developing within the R3 group. Tiede believes that blockchain tech has many applications and that its benefits are “still being conceived”.
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