The Minister of International Cooperation launches the results of the Global Partnership for Effective Development Cooperation Survey    South Sudan has 1st virus case, is 51st country in Africa    Disney+ content to make exclusive Middle East debut on OSN    4.3 magnitude earthquake hits East Nueweiba    Worldwide coronavirus cases cross 1 million, death toll passes 64,000    ‘Screens and Streams': Arab Fund for Arts and Culture releases films and music online    NBE posts net profits of EGP 20.2bn in 2019    Pope begins Holy Week events without the public    'Complete collapse of economies' ahead as Africa faces virus    Art Alert: Cairo Steps and Um Kulthoum are highlights of culture ministry YouTube channel's new releases    Serbian player sentenced to 3 months at home for flouting curfew    ‘Stay home. Save lives': Google Doodle provides tips to help stop spread of Coronavirus    Kenny replaces McCarthy as Ireland manager    Egypt non-oil private sector contracts faster as virus hits -PMI    Egypt's swimmer Osman quarantined in Red Sea resort after returning from US    Tesla cuts contractors from California, Nevada factories: CNBC    Egypt delays launch of mega projects to 2021 due to coronavirus    Sisi: Egypt in solidarity with people of whole world in coronavirus    Coronavirus cases in Egypt surpass 1,000 milestone    Japan ready to give coronavirus-hit nations anti-flu drug Avigan for free    More than 600 dead in New York state in a day from coronavirus    Amazon to postpone Prime Day sales event due to coronavirus    Egypt's Zamalek to extend Carteron's contract after end of coronavirus    Comedy puppet Abla Fahita returns to screens during Egypt's curfew    J.K. Rowling starts Harry Potter At Home for housebound families    Broadcaster predicts Spain's La Liga restart in July with no fans    Apple to stop taking cut of some Amazon video purchases on App Store    Filling GERD will begin this rainy season: Ethiopian PM    Egypt's Supreme Council of Culture launches three new competitions    Freed from detention    Huawei to explore the ultimate potential on its Huawei P40 series    Egypt, MENA growth forecast at 2.7%, -0.3% respectively: IIF    Prosecution warns of EGP 300k fine or 2-year jail for spreading fake coronavirus news    Al-Sisi discusses joint coronavirus efforts with Abu Dhabi Crown Prince    Saudi Arabia intercepts missiles over Riyadh    CBE temporarily regulates cash deposits, withdrawals    Lagging COVID-19 response to shield frail economy: Rouhani    Farwell to Egyptian comedian George Sidhom    Weekend's virtual concerts, plays, and festivals people can stream at home    Amid coronavirus outbreak, Egyptian Premier League cancellation seems inevitable    Brazilian football stadiums transformed into hospitals to treat coronavirus patients    Stay At Home: Ministry of Culture to publish free books online for public browsing    What to watch to kill time in quarantine?    Ethiopia has not sent Egypt latest designs for GERD: Minister of Irrigation    Nigerien President hails Egypt's diplomatic attempts to reach agreement over GERD    Al-Sisi appreciates Kenya's support to Egypt's stance on GERD    Cairo court acquits Mubarak's sons of stock market manipulation    Egypt's President Sisi pardons some prisoners on 25 Jan. Revolution anniversary    

Thank you for reporting!
This image will be automatically disabled when it gets reported by several people.

China taps blockchain tech to boost financing for coronavirus-hit businesses
Published in Amwal Al Ghad on 16 - 02 - 2020

As authorities in China are rushing to support businesses struggling to survive the effects of the new coronavirus, blockchain technology is emerging its potential in an archaic financing system.
Since the Lunar New Year holiday, 87 China-based businesses have gotten more than $200 million in loans through a cross-border, pilot blockchain finance platform, Xuan Changneng, vice director of the State Administration of Foreign Exchange, announced at a press conference on Saturday. Changneng did not specify a date.
The holiday, which is also known as the Spring Festival, was extended by three days to February 2 in an attempt to limit the spread of a pneumonia-causing virus that has now killed more than 1,500 people. More than half of China further delayed the shutdown by at least a week and many parts of the country are still far from resume operations normally.
″ (Due to the impact of the virus), the negative effects of previous pain points such as lack of trust in business, verification inefficiency, lack of information sharing and difficulty of timely supervision have been further amplified," Henry Ma, chief information officer at Tencent-backed online lender WeBank, said, according to a translation of his Chinese-language statement by CNBC.
"The cross-border, financial blockchain services platform can play a bigger role, and help medium and small-sized enterprises improve the efficiency and convenience of getting export trade financing and other financial credit support," Ma added.
Privately-owned, smaller businesses are among the hardest affected by the virus' disruptions. In the past few weeks, central and local governments have made a flurry of announcements to back these smaller businesses, which contribute to more than half of national economic growth and employment.
It's a step up from the national government's efforts of the past few years — to try to improve privately-owned businesses' access to financing in a state-dominated system with no established credit score records and a preference for state-run enterprises.
As of noon on Friday, banks and financial institutions have supplied more than 537 billion yuan ($76.9 billion) in credit to fight the coronavirus, Liang Tao, deputy head of the China Banking and Insurance Regulatory Commission, said on Saturday at the same press conference in Beijing.
Blockchain is the same technology behind cryptocurrencies like bitcoin. Trading of the digital currencies is officially banned in China, however the country has been rapidly pressing ahead with the development of blockchain. In October, Chinese President Xi Jinping emphasised the need for the country to become a leader in the technology sector.
In theory, a blockchain-based system enables users to create a permanent record of key documents that is easily accessible. This gives lenders a basis of trust and enables them to quickly assess how much money they can safely loan someone. For the Chinese platform pilot, a state media report said it can take just a day to apply for and secure a loan on it. In contrast, traditional loan applications in China can take days or weeks.
WeBank's Ma also highlighted that with blockchain, regulators can better scrutinize transactions and respond more quickly to fraud or risks.
In March 2019, China's foreign exchange regulator launched the "cross-border finance blockchain services platform pilot" As of Feb. 3, it had processed $15.9 billion in loans to around 2,500 businesses, three-fourths of which were medium and mid-sized enterprises, Xuan stated. He pointed out that over 170 corporate banks have joined, along with 22 provinces, autonomous regions, and municipalities.
In addition to building trust, blockchain helps rapid exchanges of different currencies. The Chinese platform is already handling foreign currencies, and Xuan said on Saturday that since Hubei province joined the platform in January, foreign businesses located there can benefit from greater efficiency in areas like export trade financing.
Alex Yang, chief executive of blockchain development company V.Systems, said the blockchain system implemented here is a closed one, in which one entity retains control. That removes some technical hurdles that open source "public" and "decentralized" financial blockchain systems face in achieving the same goal, he added, according to a CNBC translation of his Mandarin-language notes.
Yet, Yang said "if there are more and more applications, and more financial institutions pay attention, then it will be good for the development of blockchain."
Source: CNBC

Clic here to read the story from its source.