DBS launches blockchain-powered platform to enhance trade finance for Chinese SMEs

It offers multi-tier financing solutions to more than 1,000 suppliers within 24 hours.

DBS Bank has launched Rong E-Lian, a multi-tier financing facility on a logistics blockchain platform that aims to give small and medium-sized enterprises (SMEs) in China faster access to trade financing, according to an announcement.

Rong-E Lian offers multi-tier financing solutions to more than 1,000 suppliers in the company’s supply chain ecosystem within 24 hours, said DBS. The solution targets SMEs which may have limited access to trade financing due to their lack of scale or credit history.

The bank leveraged its Application Programming Interface (APIs) and integrated its digital onboarding service into the blockchain platform, which reportedly gives DBS the ability to verify the credentials of a supplier within seconds.

DBS successfully completed its first multi-tier financing transaction on the Rong-E Lian blockchain platform with suppliers in August.

“More than half of SMEs globally tend to face rejection by financial institutions for their trade finance needs, contributing to the world’s trade finance gap of $1.79t (US$1.3t). By using new technologies such as blockchain and APIs, we hope to democratise trade finance by providing SMEs more affordable and convenient access to bank credit,” said Neil Ge, CEO of DBS China.

The platform is part of DBS’ plans to expand partnerships with businesses located in the Greater Bay Area.