Bank of Mitsubishi UFJ announced on January 10 that it has issued a letter of credit using the "komgo" trade finance platform based on blockchain technology. A letter of credit is a statement of payment issued by a bank as a means to facilitate trade settlement. This is the first project using komgo issued by the London Branch based on actual transactions.
komgo is a blockchain-based trade finance platform developed by KomGo SA [KomGo]. Developed for the purpose of improving business efficiency by promoting paperless and automated processes in trade transactions. KomGo was established in August 2018 by a total of 15 shareholders, including major financial institutions including the bank, oil majors, and commodity trading companies.
Through the komgo platform, the bank will work to digitize letters of credit and trade finance products, streamline identity verification [KYC] procedures, and enhance security by encrypting documents and data between trade finance parties. Together with other shareholders, we will promote the digitization of trade finance in commodities trading on a global basis using komgo.
In the future, the Bank will position digitalization as one of the most important measures in its medium-term business plan, and will work to improve the efficiency of operations utilizing digital technology and improve productivity by automating internal processes. He clarified that he would accelerate his digitization efforts through the use of komgo.