UAE-based Abu Dhabi Islamic Bank (ADIB), a leading Islamic financial institution, announced on Wednesday that it had completed trade finance distribution transactions using Blockchain technology.
Cross-border transactions have been made possible by the partnership between ADIB and TradeAssets. TradeAssets is an e-marketplace in trade finance driven by Blockchain technology to help digitize traditional processes of trade assets origination and distribution.
Trade finance includes financial instruments used by companies to enable trade, such as credit notes, performance guarantees, import/export loans, and supply-chain finance. The Trade Finance Distribution Initiative, a collaborative project launched last year to develop industry standards and experiment with new technologies for banks and asset managers, now includes some established participants such as Deutsche Bank AG, HSBC, Standard Chartered PLC etc.
ADIB’s partnership with TradeAssets has allowed it to automate trade finance transactions and successfully conclude transactions with bank counterparts.
Haytham Elmaayergi, Global Head of Transaction Banking at ADIB, said:
“The completion of the first trade distribution transaction using Blockchain by an Islamic bank shows that ADIB is at the cutting-edge of global transaction banking. As the only Islamic bank providing end-to-end Sharia’a-compliant trade financing through digital channels, ADIB is committed to expanding its digital footprint in trade financing and distribution, enhancing the efficiency and productivity of businesses across the region and globally.”
ADIB launched “ADIB Direct eFX” in March this year, a platform that allows clients to make use of live, competitive foreign currency rates and execute transactions at any time and from any place. The bank said the platform enhances the ability of the businesses to handle their finances locally and internationally. Such features include customizable dashboards, cashflow forecasting, and online trade issuance and funding that are available through all platforms including a mobile phone app.