Banks like Standard Chartered Plc, DBS Group Holdings Ltd. have come up with a solution using blockchain technology to combat risk of multiple-invoice fraud faced by the trade finance.

Bloomberg reported that, global banks have started exploring distributed-ledger technology to develop an electronic ledger of invoices that uses a parallel platform to the blockchain. The two banks are seeking to advance technology and telecommunications working with the Infocomm Development Authority (IDA) of Singapore, to promote the system.

The IDA aims to commercialize the technology and is in discussions with other banks. IDA said that, “We need committed partners. Trade financing is borderless and banks that do adopt this technology will be able to benefit regardless of the country of origin.”

The report said that, apart from these two banks, lenders such as Bank of America and HSBC Holdings are also looking at blockchain for trade finance and other banking applications. This move has been implemented after Standard Chartered Plc lost almost US$200 million from a fraud at China’s Qingdao port two years ago.

Global head of strategic affairs at Accuity, Henry Balani said that, “For blockchain applications, invoices should be considered a leading candidate here, given the high potential for fraud.” Accuity provides technology to monitor trade-based money laundering.

Bloomberg also reported saying, if banks can go along together in a joint platform, trade financing may become ground zero for blockchain adoption as it promises to do away with paper invoices and the fraud that accompanies them. Also blockchain proponents say that the technology helps lenders cut billions of dollars in costs and will eventually change the face of banking.