Following the successful launch of Nordea’s we.trade platform, the Helsinki based Nordic Bank decided to open up the blockchain trading platform to all its small and middle-sized business customers (SMEs).
The we.trade platform was created with an aim to offer a secure venue for companies in Europe to trade with other European companies and in the process expand its services to all its clients. Based on the IBM blockchain, the platform comprises of 12 different banking institutions including, Société Générale, UniCredit, Deutsche Bank, HSBC, KBC, Natixis, Rabobank, and Santander.
According to Magnus Montan, Nordea’s head of Business Banking the platform will help address trust deficits extant in current cross-border trades carried out by SMEs.
‘’More and more small and medium sized companies getting involved in cross border trading. There are some common challenges that they face. The biggest one is related to trust in their overseas trading partners. We.trade is not only about providing trade finance, it is something much bigger than that. It is about enabling trade and with we.trade we are creating an ecosystem for the global trade, where trust is an integral part,’’ he said.
Also, Patrik Zekkar, Global Head of Trade Finance and Working Capital Management at Nordea, explained;
“Almost 60 percent of the SME’s said that they have to make advance payments so there is obviously a sense of insecurity surrounding cross-border trade. This is unfortunate, not only from a liquidity standpoint; it may also lead to companies refraining from trading and not growing.”
With the blockchain trading platform, users are now able to select certain events within a smart contract that will trip a payment to another party.
Skeptical towards Crypto, Devoted towards Blockchain
Like a few other banks, Nordea takes a hard line against crypto coins, despite the fact that it wholeheartedly welcomes blockchain technology. Last year, the banking giant banned its employees from owning Bitcoin (BTC) claiming to protect them from participating in ‘unethical’ and ‘criminal’ deals in an ‘unregulated market’.
In as much as Blockchain without crypto is a dream killer for the founders of crypto coins, with the system in hand, governments, banks and other enterprises will build more trustworthy IT systems.
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