Post-Trade Workflows, Trade Finance, Reports, and much more...
The Comdex wallet powered by WU® EDGE allows traders to achieve near-instant cross-border trade settlements. Traders present in any jurisdiction can add/withdraw funds from their Comdex wallets with the speed of the domestic telegraphic transfer infrastructure. The movement of funds within Comdex’s wallets is instantaneous, making cross-border remittances and settlements faster than ever.
Comdex’s blockchain smart-escrow automatically enforces the trade terms captured during negotiations in the trade room. The checks and verifications performed in the trade are securely captured and stored on the blockchain, in a fraction of the time taken by traditional banking escrows.
A log of all events and trade documents within a trade room is maintained and stored on the blockchain. This enhances the auditability of trade, lowering the perceived risk of the trade, allowing for greater financing reach for trades.
Negotiating Trade Terms
The Trade room module: A seamless trade workflow for maintaining an auditable log of all trade activities. Negotiate terms, sign contracts, and execute trades, all within a single-interface with complete transparency and security.
Posting A Quote
Instant issuance of sales quotes to KYC and AML verified counterparties: Begin negotiating for both pre and post-shipment trades instantaneously with verified trading parties.
Cross border commodity trade involves the handling and exchange of documents of high value and importance, and therefore, requires a high degree of trust between the trading counterparts. This leads to a reluctance among traders to engage in business with new counterparts. The risks arising from engaging in trade with unverified counterparts can be mitigated by performing thorough KYC and background checks on the trading counterparts. However, the process of performing such checks usually takes up time and can be costly.
SMEs and MEs in emerging markets often lack the capital and access to produce the level of documentation & track-record that larger trading organizations have, and more importantly trade financiers seek in the trading parties. As a result, SMEs and MEs end up with limited access to the trade financing required to maintain trade flow along with working capital for business operations. The same hurdles lead to trade financiers having limited access to verified trades seeking financing, further adding to the problem of insufficient access to financing for traders.
Comdex performs thorough and automated KYC and AML checks on all the organizations on the platform. Comdex has access to industry-grade database tools like MemberCheck. All ongoing trades on the platform have to be cleared for several checks including vessel checks for settlement of the trade.
With fully automated integrations with the KYC partners, Comdex can perform thorough checks and ensure all trading partners on Comdex have been KYC'ed. Trade financiers on the Comdex platform too will be able to make better-informed business decisions with access to trade with verified trading parties and vessels.
Commodity traders across the globe are obliged to comply with various corporate and jurisdictional regulations when engaging in trade. With existing trade workflows and details scattered across various communication channels, traders see a growing complexity in trade processes leading to an increased length of their trading cycles. Such a system of trade can also be a source of vulnerability to the security of the data. It is due to this very reason, commodity trading houses lack the ability to maintain organized data and reports on trades which can ultimately be used for auditing and performance tracking purposes.
The lack of standardization and organization in trade workflows also makes it harder for traders to seek financing for some trades. Financiers often have to rely on unverified scanned documents and email threads to have access to all trade-related information which is often not a reliable means of performing thorough due diligence.
Traders on Comdex can maintain and exchange key trade documents and information on their existing and ongoing trades, all of which are stored on the blockchain securely and immutably. The workflow on the platform facilitates structured information & document exchange, which enables counterparties to establish trust and auditability. Extensive reports of trade details can be generated and utilized by the trading parties for easy integration of trade details with their legacy corporate database systems. The reports can also be used for analysis and performance improvement.
Live Trade Room
Each trading organization has a certain set of corporate and jurisdictional regulations that bind their trading activities. Traders lack access to a single interface for communication and secure information exchange. As a result, traders end up relying on less-secure means of information exchange through third party emailing and chatting applications. The reliance on third parties to facilitate such an exchange is a major vulnerability in the trade process. Alternatively, traders must rely on face-to-face interactions to conduct negotiations and execute the contract, during which it becomes hard to maintain logs of all terms and negotiations during the trade.
The Live Trade Room is a module designed to enable trading parties to have the fastest ever trade negotiations, document exchange, and settlement (subject to the readiness and responsiveness of the trading parties).
With features like live chatbox, shared document viewing & exchange and e-signing, traders can complete all trade formalities frictionlessly with the assured security offered by the Persistence blockchain. The module aims to facilitate negotiations and exchanges with equal, if not faster, speed as face-to-face interactions with the added feature of auditable and immutable logs of all interactions. The trade room is also structured to ensure standard industry workflows can be maintained during the exchanges in the module.
The trade settlement module, powered by WU® EDGE, allows traders to make cross-border settlements almost instantly without bearing high expense and settlement times that arise from using the SWIFT system. The module uses advanced real-time domestic settlement protocols present in the platform's supported regions.
Unlike fund remittances in retail banking, remittances in the physical commodities trade run into hundreds of thousands of dollars (even millions) and therefore require a higher degree of scrutiny and documentation. Due to the high risks involved, trading parties often engage banking intermediaries to act as escrow agents in the exchange of title documents for funds. In cross-border remittances for trade, the trading parties both engage banks as their local escrow agents. The banks, in turn, appoint a correspondence bank to establish trust in trade. This means that at each point of information exchange, the documents need to be verified by all the intermediaries as well as the trading parties involved. Such a method of verification and settlement severely slows down the trade cycles, which can lead to monetary losses culminating in billions of dollars globally.
Comdex's Settlement module is a revolutionary product that can achieve near-instant settlements for commodity trades. Buyers of commodities can make domestic telegraphic funds transfers to their respective digital WU® EDGE accounts. Once Comdex performs vessel check and can verify an ongoing trade with a signed contract, the blockchain validators update the Fiat Ledger and create the instruction from Comdex to the WU® EDGE settlement module to complete the payment. The trade is simply settled instantly as a domestic telegraphic transfer to the beneficiary.
One of the most common struggles in the global import-export financing industry is the lack of access to financing for SMEs and MEs, especially those from emerging market economies. Physical commodity trade is a highly fraud-prone industry due to substantial vulnerabilities in trade processes. Trade financiers must, therefore, establish exhaustive due-diligence checks on all the trades they consider for financing. There is a need for systems that can organize all verified trade details for financiers in a way where all the trader and trade details can be easily accessed.
On Comdex, insured trades and trades with digital Bills of Exchange from obligors can be listed for financing. Trade financiers on the platform have access to a directory of verified trades between KYC'ed trading parties requiring financing. The module is designed to assist financiers in assessing financing proposals considering all the risk factors involved in the trade.
Why Comdex is built on Persistence?
Immutable audit trail
Every action of traders on the platform (such as negotiations, changes to trade terms, key trade documents, signatures, and remittances) are recorded and stored on the blockchain immutably. The Persistence blockchain offers military-grade security & encryption of trade data, accessible only to permissioned users on the platform.
Any and all information that goes on the Persistence blockchain is permanently stored immutably. The military-grade security & encryption offered by the blockchain ensures that no data, once on-chain, can ever be modified. As a result, traders have a fool-proof mechanism of ensuring key trade documents and facts aren't changed during the course of the trade lifecycle.
Greater Business Outreach
Nearly 80% of global trade is financed by traditional trade finance methods. Large volumes of trades are assessed by financiers for their credit risk. As the process of verification & risk assessment is expensive, only larger trades, involving larger organizations received the level of financing they seek, leaving SMEs and MSMEs behind.
The Comdex platform makes it easy for traders to generate and access verified data. The benefits of saved expenses of data verification extend beyond just SMEs and MSMEs, as all stakeholders involved in the trade can now make better business decisions. Financiers, underwriters, insurers, and auditors are positively impacted by this technology as well.
Improved Risk Assessment
Due to the various possibilities of fraud in trade, stakeholders involved require a high degree of trust in their trading counterparts. The establishment of trust often comes with an added expense for verification of facts and data. With the assurance of immutability to the trade data generated, stakeholders need not spend as much time and effort in verifying data anymore. Traditional risk assessment methods involving multi-party verifications are time-consuming & expensive.
The freed up expenses and man-hours from having top verify the data are now better allocated. Investors, insurers, and financiers are able to access higher quality & verified trade data in order to make informed business decisions.
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