IBM-backed trade finance platform Batavia has been successfully tested for live transactions between corporate customers, including German carmaker Audi. The transactions involved two imports in Spain – textiles from Austria and automobiles from Germany. During the process, the platform allowed participating entities to supervise each step of the trade, in which the goods were moved by road and sea.
Batavia is built on IBM Blockchain Platform technology and involves a consortium of five banks: Bank of Montreal (BMO), UBS, CaixaBank, Commerzbank, and Erste Group.
The recent experiment relied on smart contracts utilizing distributed ledger technology (DLT), another term for blockchain. Smart contracts allow triggering predetermined actions once certain conditions are met. The concept can be successfully implemented in reaching trade agreements, tracking goods, and making payments. All of these were successfully managed by the platform. The next step will be Batavia moving into the customer review phase. The participants expect the platform to be able to monitor air freight by the time it goes live.
Alexander Dietlmeier, Audi’s head of treasury, told Global Trade Review:
“We have been working for a long time on this innovative approach of a decentralised database. With the successful financial transaction based on blockchain through the Batavia platform we gained important experience and strengthened our knowledge on this field.”
Niko Giesbert, head of Commerzbank’s trade finance and cash management division, earlier commented on the trial:
“I am very grateful to Audi for their cooperation and their support for our project. Our joint successful live transaction gives an idea of the potential of our platform. The trade data and the smart payment automatically triggered by shipment data build an important basis for risk management and financing tools adding value to every supply chain.”
Even though Batavia has proven to be an efficient technology with transformative potential, those behind it are not in a hurry to share with the public the roadmap or at least the date of the full launch. Companies may join the next phase of the pilot only by invitation.