This digital marketplace is a win-win for trade finance

Dubai - Blockchain-powered platform brings greater efficiency and value to financial transactions

The UAE has a growing appetite for innovation and the FinTech sector has paved the way for radical change. Platforms like TradeAssets help bring more transparency and security to transactions through an e-marketplace.

TradeAssets was founded by two former bankers, Lakshman Sankaran and Sumit Roy, both who had been working in the trade finance industry for decades. After leaving banking, they decided to create a solution that would help the trade finance and banking industry become more efficient and profitable. TradeAssets is supervised by the Dubai Multi Commodities Centre Authority.

A year into its operations, TradeAssets today employs a team of experienced bankers across multiple locations globally and is supported by a large industry media group and a specialised cryptography company. Over the last year, the team has built the TradeAssets platform, a blockchain-powered B2B e-commerce portal where member banks can post, buy and sell trade assets among themselves. Banks in UAE, Oman, India and Bangladesh have already signed up as members and are currently using the portal to transact. Over a 100 more banks from this region and globally are in talks with the team to become members of TradeAssets.

Sankaran, founder chairman and chief executive officer, TradeAssets, said: "TradeAssets is a platform purely for banks, with simplicity and security at its core. We mapped out the manual steps of trade distribution and origination and recreated the same digitally to allow any bank to conduct the same process online with other banks. To keep the platform steps as user-friendly as possible, TradeAssets created a beta working group of product specialists and client banks earlier this year and incorporated their suggestions to ensure that the actual users will be comfortable with the functionality of the platform."

TradeAssets plans to onboard more UAE and GCC banks in the first half, adding to the list of leading banks already using the platform. Also, on the cards is the launch of the 'member only' TradeAssets app, enabling bankers to trade assets on the go, and potentially start the development of TradeAssets B2C platform which will enable select commodity traders worldwide to liaise with member banks on issuing letters of credit and other trade finance instruments, informed Sankaran.

TradeAssets is largely self-funded through the founders and some strategic investors, among them being Rupert Sayer, co-founder of the largest media group in trade finance, and Ramaswamy Madhavan, a senior ex-banker, who has joined the management team and is the chief strategy officer of the company.

Since inception, the company's funding strategy has been very selective since the founders believe in attracting investors who will be able to provide intellectual support to the business in addition to infusion of funds. The founders are in advanced discussions with global investor groups to raise up to $2 million in the final round of seed funding to enable their expansion plans.

Rupert Sayer, CEO of Exporta Group and an investor in TradeAssets, said: "As a co-founder of the world's largest media group for trade finance, I was attracted to the whole concept of TradeAssets. It has launched its user-friendly bank-to-bank e-marketplace at a time when digitisation as an enabler of greater efficiency and value is so crucial today and gaining so much traction to remove pain points in the supply chain and asset distribution business. TradeAssets is founded and staffed by a team of very competent industry experts who are very well-connected in the global universe of banks. As an investor with wide stakes in the same industry group, I was quickly convinced of the success formula I saw here, based on the fundamental strengths of the people and the solution. The FinTech revolution is well underway and there is no turning back. With trillions of dollars in trade finance being conducted globally and the need for efficiency savings, there is enormous potential for a solution as relevant as TradeAssets."

TradeAssets' focus will be to deepen and widen the reach of the existing B2B module. "The UAE is an important market because of its strong trading culture and the fact that it is a financial hub where banks and financial institutions are based and conducting business not just locally but also internationally. The role of TradeAssets will be to connect these banks to the global universe through this online portal and enable more efficient distribution of risk and pricing, thereby adding another dimension of growth and value to a financial industry that needs all the strengths and advantages it can gather to thrive amidst the various challenges in the global market," added Sankaran.

The technology behind TradeAssets is blockchain. It is built on Hyperledger fabric 1.0, a blockchain implementation hosted by Linux foundation, providing an enterprise-grade foundation for transactional applications. Blockchain is a distributed database on a smartly designed protocol that maintains a continuously growing list of data records, resistant to tampering and revision, even by its operators.

The revenue model for TradeAssets is a combination of an annual subscription and a transaction fee, which is based on the income that participants generate from each trade they successfully conduct through the platform.

Hani Almaskati, director, TradeAssets, said: "Having been a senior international banker for many years and subsequently an entrepreneur, I have observed a very strong need in the market for a digital platform like TradeAssets built on cutting-edge technology, providing a secure and efficient process for transactions. I am proud to be part of the TradeAssets solution because it offers a genuine technological advantage to banks, connects them to a universe of banks, gets them better pricing which has a positive impact on the economy by enabling more trade finance. Since the launch of TradeAssets in 2018, its product functionality has convinced many banks to become members while several international banks are looking to join as well. I believe in TradeAssets and its product offering and those who are behind it. I am confident that we at TradeAssets will transform the banking and financial technology landscape in the years to come."

- sandhya@khaleejtimes.com