Blockchain technologies are currently on the rise globally. Having that in mind it should be no surprise that fintech startups and banks are now joining forces.
Blockchain technologies are currently on the rise globally. Having that in mind it should be no surprise that fintech startups and banks are now joining forces. Barclays, Standard Chartered, and BNP Paribas reportedly back Malawian tea farmers who supply Unilever and Sainsbury’s.
So far over £ 600, 000 have been raised both by public and private funding. The idea of this funding is to imply blockchain technologies in the process of tea farming. More precisely, farmers will be able to share information about their production: prices, quality, and quantity. Moreover, companies like Landmapp and Focafet Foundation will enable farmers to share land rights documentation using mobile technologies. All this will be done under open-source standards.
On the other hand, the use of blockchains will provide companies and banks with useful information about social and environmental standards, followed in the supply chains. Sequentially sustainability will be rewarded with cheaper working capital. Second and third tier suppliers who have access to the blockchains have the opportunity to trace prices and other information uploaded by tea farmers.
The head of BNP Paribas trade competence center, Marguerite Burghardt shared her opinion on the pilot. She believes that new technologies potentially can make life easier for banks, as they provide detailed and reliable information about supply chains sustainability. In other words, banks and other organizations are now able to expand their financial incentives and offers, knowing where the environment is favorable.
Last but not least, all parties agree that data transparency attracts both clients and investors. They benefit as transactions are easily monitored and compliance issues regarding regulations like the Modern Slavery Act and Bribery Act are solved lightly.