Blockchain’s Red Hot Indian Use Case: Invoice Discounting

This week, three Indian factoring exchanges and the American blockchain technology firm MonetaGo announced launching of a full-fledged blockchain. The yet-unnamed blockchain, built on HyperLedger Fabric, will be used to secure receivables financing.

The three factoring exchanges involved are:

  1. RXIL or Receivables Exchange of India (RXIL), a joint venture between NSE Strategic Investment Corporation Ltd (NSICL) and Small Industries Development Bank of India (SIDBI)

  2. A.TReDS, a joint venture between Axis Bank and mjunction Services

  3. M1xchange, operated by Mynd Solutions

RXIL, Axis Bank and Mynd Solutions were licensed by the Reserve Bank of India to operate Trade Receivables Discounting System (TReDS), as the service is known in regulatory parlance, in November 2015.

MonetaGo, a New York-based technology firm, is an old India hand. It was the primary technology supplier for a blockchain trial conducted by Institute of Development & Research in Banking Technology (IDRBT), RBI’s research arm, in January 2017. National Payment Corporation of India (NPCI) and multiple banks participated in the trial, which incidentally was also around trade finance and was also built on Hyperledger Fabric.

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