Deutsche Bank and the World Bank are partnering on a new trade finance platform, a move that could accelerate the digitization of one of the most stubbornly analog corners of global finance.
Trade finance represents a market valued at over $5 trillion annually. And yet, much of it still relies on physical paperwork, manual document checks, and settlement processes that can stretch for days.
Why trade finance is crypto-adjacent territory
Deutsche Bank has spent the better part of a decade testing distributed ledger technology for supply chain management and letter-of-credit processes. The World Bank has previously issued blockchain-based bonds, including the bond-i instrument on Ethereum.
Every time goods cross a border, paperwork follows through letters of credit, bills of lading, and insurance certificates passing through multiple intermediaries before a single shipping container moves. Previous bank-led DLT initiatives in the trade finance space have demonstrated the ability to reduce processing times from days to hours.
