Spanish BBVA Becomes First Global Bank To Issue Loan Using Blockchain
Banco Bilbao Vizcaya Argentaria (BBVA) became the first global bank to issue a loan using Blockchain technology. The Spanish multinational bank said it conducted the entire loan process, from the negotiation of terms to the signing, on a mutually distributed ledger that informed both the bank and the borrower of the loan’s progress. Using Blockchain reportedly cut the negotiation time for the €75 million loan from “days to hours”. BBVA called the process a “significant advance in the exploitation of technology”.
Blockchain has strong appeal in the sphere of corporate and syndicate loans, as corporate and syndicated lending is more complex than consumer lending; records must be accessed by a wider range of individuals. The bank has several more transactions in the immediate pipeline, and would also be launching a pilot program with Spanish telecom corporation known as Indra. Indra has described itself as “at the vanguard” for Blockchain applications.
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
– Carlos Torres Vila, CEO – BBVA
BBVA’s pilot project will use a private Blockchain for negotiating and completing the loan process, after which it will be registered and completed on the Etheruem public Blockchain. BBVA is also developing Blockchain applications for international trade, international lending, and foreign exchange. BBVA has enthusiastically adopted new technology and business models.