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South Korea Trade Finance on Blockchain by 2021

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South Korea has launched a development plan for digital trade to fully integrate blockchain into its trading operations in the next two years. The country remains at the forefront of adopting some of the newest technologies. As blockchain gained traction in early 2018, it was one of the initial few countries to experiment with the blockchain’s potential in reviving business functionalities.

Reduce trade costs by more than 90%

The government established the digital trade foundation aiming to promote e-commerce; and cut time and cost related to finance trade with up to 90 percent. Vice Minister of Commerce and Industry Chung Seung-il said the initiative is focused on South Korea’s global digital trade market and upgrading the Korean online export support.

In terms of trade finance, relevant documents will be shared on the blockchain so they can be accessed by financial institutions while export bonds will be made available in the same way so that banks can check for duplicate issuing.

These efforts are key elements in the country’s Development Plan for Digital Trade, which was introduced by Finance Minister Hong Nam-ki on Oct. 14. Under the plan, blockchain, along with 5G and AI, will be utilized to transform the trade environment and strengthen exports.

The full transition could be completed by 2021, while foreign-exchange transactions are set to be conducted using the technology within months.

South Korea’s Adoption of Blockchain Tech

Blockchain becoming quite a buzz among South Koreans, and they have made significant effort in adopting it cementing South Korea as a global leader in Blockchain adoption. South Korea has also become a cryptocurrency hub with Upbit and Bithumb being among the world’s top 25 exchanges and combine for a daily trading volume of above $200 million.

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