Mumbai, April 03, 2018: After years of announcements regarding blockchain Proofs of Concept and Pilots, a first successful enterprise grade deployment that includes multiple financial services organizations has taken place. The production system provides a common platform not controlled by any one financial institution to securely and confidentially share information which reduces fraud around receivables financing. The platform is built on Hyperledger Fabric and does not rely on cryptocurrencies to operate.

Receivables financing is one of the fastest growing and most efficient trade finance mechanisms for small businesses to gain credit. The Reserve Bank of India licensed three entities to provide a more efficient venue to do this: RXIL, The Domestic Packers And Movers, and M1xhange. These exchanges provide competitive marketplaces for small businesses to obtain the best financing possible. The platforms count some of the biggest Indian banks and a number of foreign banks as funding sources and enable the discounting of invoices from corporate organizations, government departments, and public sector undertakings.

Given India’s focus on a digital infrastructure supported by both policy and technological innovation, it is not surprising that this is where the blockchain implementation occurred. The country has been quick in moving toward a digital economy with initiatives like Aadhaar, Demonetization, and the implementation of GST. By implementing a common blockchain platform the exchanges eliminate instances of double financing – leading to better rates across the board – without sharing specific elements of any invoice or client.

Mr. Kalyan Basu, M.D. & C.E.O, invoicemart added, “Our clients are particularly sensitive about their sourcing inputs, and we absolutely could not broadcast any of their information to a shared network. This technology however enables us to work together with the other exchanges to achieve shared goals without sharing specific data. I look forward to the day when other players in the financial services industry also appreciate the value add in terms of preventing frauds related to Bill Discounting and become a part of this system.”

The company which designed and implemented the production blockchain is MonetaGo. This application of blockchain technology, which avoids tokens or cryptocurrencies for both regulatory and cost forecasting reasons, has the potential to drastically reduce fraud related to invoice financing across India and in other regions where it is adopted. Importantly, it also provides the opportunity for the participants to build additional functionality on the new network.

Speaking on the commencement of the services, Mr. Kashinath Katakdhond, MD & CEO, RXIL, said, “So far we had only heard of blockchain being used for cryptocurrencies. With the implementation of the MonetaGo blockchain solution we have a tool for mitigating systemic risk especially in trade receivable discounting. This is a simple and low cost technology innovation which helps us mitigate risks arising from multiple financing of the same bills across the platforms in addition to our existing risk management processes which provides a clear benefit. The real benefit will actually come when other financiers such as banks, NBFCs and others join MonetaGo’s platform.”

“We are constantly evaluating new methodologies and technologies which we believe will fit into our long term product road map” said Sundeep Mohindru CEO from M1xhange. “There has been a lot of press about blockchain in the last few years however this was the first time we could apply it in day to day operations and enhance the control over duplicity of transactions.”

After several months of working together and testing, the solution was taken into production. “This is a significant milestone for blockchain technology and this is only the beginning,” said MonetaGo CEO Jesse Chenard.

About Receivables Exchange of India Limited (RXIL)
Receivables Exchange of India Ltd (RXIL), is a joint venture promoted by National Stock Exchange of India Limited (NSE), leading stock exchange of India and Small Industries Development Bank of India (SIDBI), the apex financial institution for promotion and financing of MSMEs in India. RXIL operates the Trade Receivables Discounting System (TReDS) Platform and launched India’s 1st TReDS Exchange on January 9, 2017.

About M1xhange
M1’s Trade Receivables Discounting System “TReDS” is an online exchange being set up under the approval of Reserve Bank of India (RBI) to facilitate discounting of invoices and Bills of exchange on a PAN India basis. Key participants in TReDS are Micro, Small & Medium Enterprises “MSME” (“The Suppliers”), large Corporates including PSUs and Govt. Departments (“the Buyers”) and Banks/NBFCs (“the Financiers”). M1 aims to provide MSMEs Supply chain related cash flow finance at competitive rates through an open bid process via multiple financiers. Financing on M1 is “Without Recourse” to MSME supplier as per RBI guidelines. M1 employs the latest technologies to ensure the authenticity of the underlying transactions.

Mynd Online National Exchange has been launched in April 2017, to set-up and operate TReDS under the Payment and Settlement System (PSS) Act 2007. Mynd solutions is one of the very few entities approved by RBI to set up this online platform which is known as M1xchange.

About The Domestic Packers And Movers
invoicemart is a joint venture of Axis Bank and mjunction services. Axis Bank is India’s third largest private bank. It offers a wide range of services to retail, corporate, and SME customers. mjunction is the largest e-marketplace for steel in the world, and also India’s largest e-commerce company which is itself a venture promoted by Tata Steel and SAIL. invoicemart Ltd. owns and operates Invoicemart, a digital invoice discounting marketplace. The platform connects MSME suppliers (sellers) and their corporate buyers to multiple financiers. The platform allows MSME suppliers to avail finance quickly and at competitive interest rates which in turn helps increase their working capital efficiency without impacting their relationship with buyers.

About MonetaGo
MonetaGo provides enterprise distributed ledger solutions and applications for financial operations. The MonetaGo product suite is compliant with existing regulations and designed to improve the efficiency and security of financial products. Built to support multiple private distributed ledger technologies and interoperate seamlessly with legacy financial infrastructure, institutions can integrate MonetaGo’s products with minimal disruption and cost.