ING Banking Group Expands Blockchain Usability With Komgo And Vakt Initiatives To Rival Bakkt
ING Banking Group Expands Blockchain Usability With Its Komgo And Bakkt Initiatives
The Dutch banking group ING is moving towards blockchain technology in 2019. ING aims at expanding programs related to trade and commodity finance related to energy, crude oil, soybeans and other metals. The information was released by Vakt at the end of November.
The company has been working with blockchain technology since 2017 with a platform called Easy Trading Connect (ETC). This shows that there are some potentialities in blockchain technology that are being used by ING to improve its services.
ING wrote on Twitter that the intention is to empower clients to transition to a distributed economy. The firm has already tested 44 proof of concepts and has completed 8 live pilots.
Distributed Ledger Technologies (#DLT) are disrupting the #financial industry and make processes more efficient and secure. Let’s take a brief moment to look back on ING’s 2018 achievements in this area. #blockchain #innovation #fintech pic.twitter.com/vT30euwVZN
— ING (@ING_news) December 27, 2018
ING is working with a platform known as Vakt (this is not Bakkt, which is being developed by the Intercontinental Exchange). This is a digital ecosystem for post-trade processing and it aims at transforming the trade lifecycle and streamlining transactions.
This platform has been developed by nine energy majors and independent traders and banks. It is worth mentioning that Vakt is based on JP Morgan’s blockchain network Quorum. There are already different companies working with the Quorum platform that eliminates duplicate data sets and paper contracts. Vakt will be linked to another Komgo for commodity trade finance.
Komgo SA is a large trade finance consortium that wants to create a new decentralized and Ethereum based platform including institutions and international banks from all over the world. These companies include ING, Citi and Rabobank, among many others.
Vakt’s ambition is to extend the platform to all physically traded energy commodities. During the first months of 2019, the platform has already some products ready to be launched.
Andrew Smith, EVP Trading & Supply, Shell International Trading and Shipping Company Limited, commented about this:
“Digitalisation is changing how the energy value chain works. It’s an exciting time. Collaboration with our peers and some of the industry’s key players is the best way to combine market expertise and achieve the scale necessary to launch a digital transaction platform that could transform the way we all do business. Ultimately the aim is improved speed and security, which benefits everyone along the supply chain from market participants to customers.”
However, this is not the only blockchain initiative in which ING is focusing on. ING’s program director, Arnoud Star Busmann commented that after a pilot with Mercuria, an energy trader, new collaborations surged with other leaders in the space, including BP, Shell and Equinor.
According to some reports, the time to process a transaction went from three hours to 25 minutes. Furthermore, traders’ efficiency increased by 33% and user experience evaluations were higher than expected.
It is very important also for companies to have control over the products they handle. Traceability for metals and mining is a very positive improvement since there is a higher opportunity to bring more control to the industry.
Both Komgo and ING should have a streamlined integration since both companies are members of the popular Enterprise Ethereum Alliance (EEA).
There are many other companies in the world that are starting to work with blockchain. This technology provides efficiency improvements and reduction of costs.