Founded: January 2020
Products: Network built on R3’s Corda blockchain
Overview: Contour is a global network of banks, corporates and ecosystem partners working together to change trade finance. Formed by a group of leading trade banks, its aim is to build a new global standard for trade by removing barriers and digitising trade finance products, starting with Letters of Credit (LC).
Its blockchain-based platform was initially tested by around 80 banks and corporates, with trials in 17 countries, across sectors including commodities, petrochemicals, energy, metals, retail goods and textiles. It went into a commercial beta phase as a standalone legal entity in January 2020 and transitioned to a live production environment by October 2020.
Contour is built on R3’s Corda distributed ledger technology. This allows the development of a network where all participants keep their own data while transacting and sharing information securely with other participants on the network in real-time.
Negotiable instruments such as LCs that are registered on blockchain are acceptable in certain jurisdictions only; in others, documentation needs to be printed on paper and signed. A new legal framework therefore had to be created to enable the use of digital documentation. To counter this, Contour’s members worked collaboratively to develop a specific rulebook and membership agreement. The rulebook works alongside existing ICC Uniform Customs and Practices (UCP) for documentary credits. Contour’s Innovation Lab will explore and develop new product offerings under the ICC’s new Uniform Rules for Digital Trade Transactions (URDTT).
Contour’s interoperability with shipping networks (eBL/port/customs) and trading networks gives corporate clients an end-to-end experience across trade, finance, execution and delivery elements. The processing times of digitised LC transactions have shown to fall up to 90% (from an average of 10 days to under 24 hours end-to-end).
The Contour network is accessible to the full spectrum of banks, corporates and integrator fintechs for trade finance. Having grown beyond its initial investor bank base, there is no differentiation on its platform between any investor and user. Since its founding, Contour has grown its network to include 16 banks over the span of more than 50 countries.
A number of partners have since joined the platform including Bolero and essDocs.
In 2021, Contour expanded its footprint in Asia, announcing partnerships with locally-based system integrators in China, Japan, Thailand and Vietnam.. The aim is to help domestic companies and their global trade partners integrate with the Contour network, and extend their business reach abroad, by providing technical services.
In August 2021 Contour announced its partnership with the Global Shipping Business Network (GSBN) to offer an end-to-end digital solution for all participants involved in trading, financing and shipping goods around the world. GSBN’s blockchain-enabled operating system and its product Cargo Release enables digital sharing of verified logistics and cargo data.
In September 2022, Contour announced its acquisition of the rulebook and associated legal documentation from the failed we.trade platform, boosting its plans to support open account trade transactions for SMEs in Europe.
The bank-driven we.trade solution delivers Uniform Rules for Digital Trade Transactions (URDTT)-compliant digital open account trading alongside digital letters of credit. It had already defined aspects such as its smart contract protocol and dispute resolution process, with these sitting alongside use of the novel bank payment undertaking (BPU). The BPU offers sellers an irrevocable undertaking to pay an invoice at maturity, potentially facilitating financing with the seller’s bank discounting agreed BPUs.
At the time of the announcements, Contour said it intended to focus its efforts on its existing LC trading solution while it slowly introduces the concept of digital open account trade to the market. It also said it was aiming to convert the single-bank we.trade model into a fully bank-agnostic proposition for corporates.
TMI Awards: Contour was the winner of TMI’s 2021 Technology & Innovation Awards for Best Trade Finance Solution
Clients: Over 80 clients including Bangkok Bank, BNP Paribas, DBS, CTBC, HSBC, ING, SABB, Standard Chartered, SEB, SMBC, Rio Tinto, Xiamen ITG, ArcelorMittal Nippon Steel India, Vale, British American Tobacco Bangladesh
Active region(s): Africa, Asia, Europe, North America, Middle East
Partners: Partners include Bolero, IntellectEU, essDOCS, Chinsay, TradeCloud, Mphasis, CargoX, WAVE BL, TradeSun, ThoughtWorks, Global Shipping Business Network, MineHub, Tinhvan Technologies, MFEC and TIS Intec Group
Ownership: Bangkok Bank, BNP Paribas, Citi Ventures, CTBC, HSBC, ING, SEB, Standard Chartered, Bain & Co, CryptoBLK, SMBC, TIS Intec Group and R3
Elevator pitch: “Paper-based processes need to be eradicated. Not only are they extremely outdated but they now pose a significant security risk – both to public health through transmission and privacy concerns as more people work remotely and utilise less secure servers. Our solution is accessible; it can work for a local bank or corporate in emerging markets, as well as a global trade finance bank or a multinational corporate in more developed markets. As an industry, we can fail alone or succeed together. The rising tide raises all boats, and through innovating as a collective, we can improve the overall process of trade finance.”
TMI View: Given that trade finance remains in the dark ages as far as paper usage is concerned, this platform and network shows a remarkable appetite from its many banking and corporate members to move forward into the digital age. In its short life to date, it has made some very interesting inroads into the trade space, especially in gathering support from some of the long-standing players such as Bolereo and essDocs.
Verdict: Expect to see a lot more of this network.