Infosys Finacle, a wholly-owned subsidiary of Indian tech giant Infosys, has set up a blockchain-based trade network in the country in collaboration with seven major domestic banks.

The network, India Trade Connect, has been formed in partnership with Axis Bank, ICICI Bank, IndusInd Bank, Kotak Mahindra Bank, RBL Bank, South Indian Bank, and Yes Bank.

India Trade Connect is being used by the banks to run a pilot of Finacle Trade Connect, a blockchain-based trade finance solution developed for banks. Finacle Trade Connect will facilitate enhanced automation and transparency, while helping efficiently manage risks in trade and supply chain financing operations.

"[D]igitization of Trade Finance processes using distributed ledger technology offers immense potential to eliminate the friction, cut costs and increase revenue through new business products that are now viable using the modern technologies,” Sanat Rao, Chief Business Officer, Infosys Finacle, said.

India Trade Connect has been designed to digitize trade finance business processes, including validation of ownership, certification of documents and making payments, while working on a distributed, trusted and shared network. The range of functions include bill collection, letters of credit, open account for trade, customer to customer, transactions for trade, business to customer transactions for trade, PO financing and invoice financing.

The platform will offer a number benefits to the participants including cost reduction, risk mitigation, speed, and traceability and security. By enabling everyone involved in a transaction to have a single source of the truth, it will also help banks make more informed financing decisions. It will ensure that the banks involved in a transaction are aware of the exact position of a bill as well as the exposure of the corporate with its respective partner bank.

Infosys Finacle has also addressed technology evolution risks by making the network agnostic to underlying blockchain infrastructure such as Hyperledger, Corda, Ethereum, and Bitcoin.