UTC’s digital commerce platform goes live with 7 banks – News
UAE Trade Connect (UTC), a new national blockchain platform, officially launched on Monday to help financial institutions fight fraud and duplicates.
Co-created by Etisalat Digital, seven major UAE banks and Avanza Innovations, the idea was first proposed by First Abu Dhabi Bank to tackle key issues in the area of trade finance. The platform’s steering committee is made up of the Central Bank of the United Arab Emirates, Commercial Bank International (CBI), Commercial Bank of Dubai (CBD), Emirates NBD, First Abu Dhabi Bank (FAB), Mashreq Bank, National Bank of Fujairah (NBF) and RAKBANK.
Dr Sabri Al Azazi, Director of Operations at the Central Bank of the United Arab Emirates, said: “The Central Bank promotes financial and monetary stability, efficiency and resilience of the financial system. The launch of the UTC digital commerce platform is one of the key steps to achieve this goal, as it will help to minimize the risks of fraud inherent in the existing paper system in trade finance. It also reflects the banking industry’s commitment to accelerate the digital transformation process to prepare the UAE to enter the new digital banking era. “
Speaking during a webinar at the launch event, Zulqarnain Javaid, CEO of UTC, explained that six months of testing have been spent on the project and that UTC will “be a game-changer for the space. of trade finance ”.
“The idea came about about two years ago,” he said. “We regrouped the consortium in mid-2019 and started testing towards the end of 2020. The central bank’s fintech office also took an early interest in the concept. This program was considered such an important part of digitization that even in the first year of the Covid-19 pandemic, all banks dedicated their IT resources to it. “
The platform is based on blockchain and other disruptive technologies that allow data to be shared securely. Technologies such as artificial intelligence (AI), machine learning, optical character recognition (OCR) and robotic process automation (RPA) read invoices to identify duplicates, fraud and questionable transactions at the within the banking trade finance supply.
The initial phase will focus on managing the risks of double financing and invoice fraud before moving on to other key areas of trade finance, such as the digitization of bills of lading and electronic invoices. UTC aims to drive the digital transformation of commerce in the UAE by enabling banks, businesses and government authorities to collectively benefit from future technologies.
Anirudha Panse, Managing Director and Head of Commercial Product Management at FAB, described UTC as a “platform for banks built by banks”.
“The success of this platform will depend on the collaboration of many banks and their integration into the solution. Bill fraud is a problem faced by many banks in the UAE. We believe UTC will benefit the wider ecosystem, and the idea is to make UTC a national platform for trade finance, ”he said.
Reda Ezzat, Senior Vice President and Head of Trade and Structured Finance at Mashreq, also highlighted how UTC will help SMEs in the UAE. “Globally, SMEs represent 90 percent of all businesses in the world. They contribute 40 percent of the GDP of developing countries; in the United Arab Emirates, the same data applies. Access to finance is a major challenge for SMEs. UTC will help UAE banks improve their risk appetite, which will translate into easier access to finance for SMEs. “