South Korea Plans to Put Its Entire Trade Finance On Blockchain By 2021

The South Korean government is working on using the blockchain technology for digital trade finance activities. As per the reports from local media, The Korean government will completely transform its trade finance activities on a blockchain platform by 2021.

The announcement was made earlier this week on October 14 by South Korean Finance Minister Hong Nam-ki while introducing the country’s Developmental Plan for Digital Trade.

The Finance Minister said that the government plans to use upcoming and emerging technologies like AI, blockchain, and Big Data within the entire Korean trade finance system. Minister Nam-ki said: “We will build a digital trading platform that can be easily and conveniently used in all stages of export, such as contracts, customs and logistics.”

The trade finance system, all the documents will be brought on the blockchain platform which can be simultaneously accessed by all other financial institutions. Similarly, exports bonds will be available on blockchain which will help banks to prevent any sort of duplicate issuing.

Besides, the Korean government is also looking to form a digital trade foundation. With this, the government seeks to promote e-commerce exports while simultaneously cutting down on costs and time related to trade finance by more than 90%.

Chung Seung-il, the Vice Minister of Commerce and Industry said that these initiatives will help South Korea to take a lead in the digital trade market along with giving a major boost to Korean online exports.

He added: “We will make trade more convenient by integrating and providing trade information and export support services of government and trade organizations.”

Besides, to execute this Digital Trade plan effectively, the government plans to form a blockchain council comprising of several participants in the trade finance process. This includes banks, trade associations, banking associations, and the Korea Trade Network that looks after the automation of trade processes.

The development plan also states that another goal of this initiative is to bring blockchain-based foreign exchange transactions. The service for blockchain-based forex transactions will be available to customers by the end of this year.