China Construction Bank (CCB) utilizes blockchain technology for small business financing.
China Construction Bank (CCB), the world's second-largest bank by assets, has officially launched its blockchain-based restructuring platform aimed at supporting financing for small businesses.
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Building a Blockchain Platform for Construction Bank
According to reports, the bank aims to help small and micro companies sell their accounts receivable, such as short-term accounts receivable, at a discounted price in exchange for immediate cash payments.
The new platform will enable the bank to purchase financial receivables from small businesses through factoring companies, and provide other financial services including credit risk guarantees and accounts receivable management. This strengthens its business, reduces key risks, and provides data sharing among multiple participants.
This new platform represents the latest initiative in the Chinese banking industry to develop such trade finance services on blockchain-based platforms. Since its launch in April 2018, the bank has surpassed $53 billion in transaction volume and upgraded its trade finance platform in October, known as the second version BCTrade 2.0.
Through the use of BCTrade 2.0, digital trade and financial services among more than 54 domestic and foreign institutions, including multiple state-owned and foreign banks, can be achieved.
Chinese Banks and Blockchain
China is currently supportive of the use of blockchain technology in financial measures, with Chinese banks recently using blockchain to provide funding for small businesses, completing the pricing and issuance of approximately $2.8 billion in bonds, which were loaned to small enterprises using blockchain technology.
This funding is specifically aimed at issuing loans to these Chinese small and micro companies to support their economic and financial service infrastructure development.
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