HSBC has successfully completed a blockchain-enabled trade finance transaction between Chinese automaker SAIC Motor and Taajeer Group, Saudi Arabia’s exclusive agent for MG cars. Conducted on the Contour platform, this is a regional first for the automotive industry and the first transaction of its kind in the Kingdom.
The Contour platform enabled the end-to-end digitization of the credit documentation required for Taajeer to import a shipment of cars from SAIC in a process that is up to 10 times faster than using physical documents.
Chaker Zeraiki, Head of Global Trade & Receivables Finance for HSBC UAE, said: “Our digitization at scale means making customers’ lives easier, and with Contour, that means we’re cutting costs, reducing risk and increasing the speed of trade. Bringing these benefits to the automotive sector and Saudi Arabia are a measure of our international connectivity and our global leadership in merchant banking.”
Trade finance drives much of global trade and according to HSBC, distributed ledger technology has the potential to reduce transaction times from between five and ten days to under 24 hours, therefore unlocking working capital and enabling more trade between markets.
Carl Wegner, CEO of Contour said: “This transaction marks an important milestone in the Middle East automotive sector and proves that distributed ledger technology is transforming the trade finance ecosystem. We are excited about the potential for wider adoption in this sector, since having a digital commerce solution is no longer an option, but the new standard for the industry.”
Using Contour’s platform also makes transactions more secure as data shared on the network is indisputable and transparent, which reduces the risk of fraud.
Tom Lee, Managing Director of MG Motor Middle East, owned by SAIC Group, said: “It gives me great pleasure to continue to provide ‘best-in-class’ service through an integrated supply chain program that can smooth our business. more seamless. With HSBC as our partner, we will proactively offer solutions to ensure our clients’ requirements are met safely and on schedule. I believe that our bright future is filled with opportunities and our customers can be confident that they will be met with consistent high quality supply from us, anytime and anywhere in the Middle East region.”
The transaction is also the first in Saudi Arabia where, according to David Leslie, general manager of Trade Finance Business at SABB, increased digitization is aligned with the Vision 2030 initiative to make the Kingdom a regional trade hub. “Blockchain can significantly reduce friction and increase the pace of trade for companies trading with Saudi Arabian entities.”
As it seeks to digitize US$53 billion of global trade finance, Contour uses decentralized technology to integrate digital networks for the instant transfer of reliable data across trade routes and currently fragmented ecosystems globally.
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Will Blair
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Tony Hannon
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HSBC in the MENAT region
HSBC is the largest and most represented international banking organization in the Middle East, North Africa and Turkey (MENAT), with a presence in nine countries across the region: Algeria, Bahrain, Egypt, Kuwait, Oman, Qatar, Saudi Arabia, Turkey and the United Arab Emirates. In Saudi Arabia, HSBC is a 31% shareholder in Saudi British Bank (SABB), and a 51% shareholder in HSBC Saudi Arabia for investment banking in the Kingdom. Across MENAT, HSBC had assets of USD 71 billion as at 31 December 2021.
HSBC Holdings plc
HSBC Holdings plc, the parent company of the HSBC Group, is headquartered in London. HSBC serves clients worldwide from offices in 64 countries and territories across our geographic regions: Europe, Asia, North America, Latin America, the Middle East and North Africa. With assets of USD 2.958 billion as at 31 December 2021, HSBC is one of the world’s largest banking and financial services companies.
Contour
Contour is a leading digital trade finance network that builds the global standard for trade by bringing together the world’s banks, businesses and ecosystem partners into a common, digital and trusted network. Driven by innovation, trust and collaboration, Contour uses decentralized technology to offer seamless integration with market-leading digital document systems and other digital networks, enabling the immediate flow of trusted data across the world’s trade routes and currently fragmented ecosystems. Contour has been named leader in trade for two consecutive years at the GTR Awards (2022 and 2021). It was also named the best trade finance solution in 2021 by Treasury Management International.
www.contour.network
