Spanish BBVA Becomes the First Global Bank to use Blockchain in Issuing Loans

FT Report Claims

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Banco Bilbao Vizcaya Argentaria (BBVA) just became the first bank globally to give a loan by the use of Blockchain technology. This is according to the FT report made on 25th April.

Therefore, the Spanish multinational Bank explained how they carried out the whole process, the terms negotiation for signing. This involved a mutually distributed ledger which gave information to both the borrower of the loan and the bank.

Therefore, by the use of Blockchain, this cuts the time of negotiation for the €75 million from days to hours. Additionally, BBVA described the entire process as a “significant advance in the exploitation of [distributed ledger] technology”.

Carlos Torres Vila who is the BBVA CEO declared that the bank had “several more transactions in the immediate pipeline”, and also that the bank would be involved in the launch of a pilot program in collaboration with Indra which is a Spanish telecom corporation. Therefore, Indra considered itself as “at the Vanguard” for the Blockchain applications.

Blockchain has been having a very strong appeal in the syndicate and corporate loans sphere. This syndicated and the corporate lending has more complexity than the consumer lending, therefore, the records should be accessed by a lot of individuals.

Torres Vila said;

“Blockchain can offer clear advantages for all sides in the corporate loan market in terms of efficiency, transparency, [and] security… It’s another strong example of how disruptive technology can be used to add value to financial services, something that is central to our strategy.”

Therefore, the pilot project for BBVA will use a private Blockchain for the negotiation and the completion of the loan process. After this, the project will then be registered and also completed using the Ethereum public Blockchain. On the other hand, BBVA has been involved in the development of various Blockchain based applications for international lending, international use and also for foreign exchange.

BBVA has completely adopted the new business models and technology. Therefore, it has also made investments in various ventures which include the Solaris Bank who, as reported by Cointelegraph, were involved in the development of the first crypto trading desk in Germany for VPE bank.

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