# Integrating electronic bills of lading into trade finance

> essDOCS Ltd. integrated its CargoDocs DocEx document solution into the blockchain-based trade finance application developed by the Voltron consortium. This integration provides corporate clients and financial institutions with unified access to electronic bills of lading and accompanying trade documents under letters of credit. As part of these operational trials, the partners executed a fully paperless end-to-end iron ore trading transaction.

**Sector:** Tertiary sector · **Industry:** Shipping and maritime transport · **Organisation:** essDOCS Ltd., Voltron (Bankenkonsortium auf R3 Corda) · **Maturity level:** Pilot

Canonical URL: https://www.sapientblock.com/en/use-cases/essdocs-elektronische-konnossemente-handelsfinanzierungsprozesse-einbinden

## Documentation status

- **Project status:** Pilot
- **Evidence:** Evidence medium
- **Editorial review:** pending

## Description

essDOCS Ltd., in collaboration with the Voltron banking consortium, has demonstrated how shipping documents and trade finance can be digitally consolidated on a shared platform. In traditional foreign trade, original documents such as bills of lading often have to be couriered for days before banks release payments or ports hand over cargo. By linking the CargoDocs DocEx system with distributed ledger technology, all contract-relevant information is immediately and fraud-proof available to the parties involved.

The technical collaboration aimed to seamlessly connect the established CargoDocs DocEx solution from essDOCS for electronic bills of lading to the R3 Corda-based Voltron trade finance platform. Through programming interfaces, banks and corporate customers receive a consolidated view of all data and title transfers processed under a specific letter of credit. According to a 2019 World Trade Organization (WTO) report, this document integration was tested in over 25 production-near pilot tests by international financial institutions. A practical milestone was the handling of a fully digitised transaction in international iron ore trade in August 2019. The implementation demonstrates that existing industry solutions for legally compliant electronic shipping documents can successfully interact with DLT financing networks to overcome manual media breaks in global shipping.

## Benefits

- Faster release of goods and funds
- Reduced transaction and courier costs in foreign trade
- Shortening of letter of credit processing times from days to a few hours
- Avoidance of port demurrage charges through timely proof of ownership
- Elimination of fraud risks through tamper-proof digital title transfers
- Elimination of repetitive paper verification processes
- Lower error susceptibility in letter of credit reconciliation

## Challenges

- High reconciliation effort between banking consortium and IT service providers
- Slow acceptance of digital transport documents by customs authorities
- Incomplete legal harmonisation of electronic bills of lading in many port states
- Need to connect numerous heterogeneous IT systems of banks and shipping companies
- Transition of proven verification routines to digital document views

## Technology foundation

R3 Corda DLT platform, developed for banks and corporate consortia, ensuring confidential exchange of sensitive cargo and financial data through strict point-to-point messaging.

## Sources

- [essDOCS partners with Voltron to integrate CargoDocs DocEx into blockchain trade finance application](https://www.essdocs.com/press-room/essdocs-partners-voltron-integrate-cargodocs-docex-blockchain-trade-finance-application)
- [essDOCS enables first fully integrated paperless trade in iron ore](https://www.essdocs.com/blog/essdocs-enables-first-fully-integrated-paperless-trade-iron-ore)
- [Blockchain & DLT in Trade](https://www.wto.org/english/res_e/booksp_e/blockchainrev19_e.pdf)
- [essDocs to integrate e-bill of lading with Voltron blockchain platform](https://www.gtreview.com/news/top-stories/essdocs-to-integrate-e-bill-of-lading-with-voltron-blockchain-platform/)