MasterCard inked an inaugural strategic partnership in the Shanghai Free Trade Zone (SFTZ) where MasterCard will be the global network and payment technology provider for a revolutionary commodities trading platform.
The Cross-Border Commodities Financial Services Platform is a pioneering effort by COMMIN, ValuePay and MasterCard, supported by MasterCard’s key banking partners including DBS Bank, CIMB Bank and Bank of Shanghai, who have expressed interest in participating in the pilot test of the platform.
An exclusive first for Mastercard, this partnership was announced at the signing of a Memorandum of Understanding (MoU) between all parties.
In the process of conceptualizing and developing the platform, Mastercard was instrumental in bringing about the digitization of payments in the platform, driving efficiencies and transparency for all parties using the platform.
The Cross-Border Commodities Financial Services Platform is a revolutionary eco-system and model, pioneered and tested at the SFTZ, with a view to scale the platform globally.
Some of the key benefits of this platform include:
• Greater transparency and accountability – With a fully digital platform from payments to documentation, the Cross-Border Commodities Financial Services Platform is designed to bring greater transparency and accountability to the trade process. It provides authorities and stakeholders with deep and detailed visibility of the full trade cycle, including the payment of duties and subsequent transactions
• Enhanced efficiencies and savings – The platform is designed to bring about significant savings in terms of time and cost to all parties involved in the eco-system. In contrast with the existing system which involves heavy administration and is very labor-intensive, the new platform will enable an efficient and convenient trading environment for all parties
• Deeper connectivity and security – The platform will also bring about deeper connectivity and a higher security for the various parties and stakeholders in the SFTZ. This in turn will enhance collaboration and coordination within the SFTZ, connecting banks, regulatory bodies, bonded warehouses, merchants and businesses through one platform
The platform will also serve as a means to authenticate the credibility of merchants and traders, opening up opportunities for more banks around the world to be a part of SFTZ’s trade financing and encouraging an increased volume of cross-border transactions.
MasterCard sees the Cross-Border Commodities Financial Services Platform as an opportunity to bring its global network together with innovative digital payment technology to create a solution that replaces the previous system, which was burdened by significant administrative and costly processes.
Through the platform, MasterCard hopes this will be the model for future global trade hubs, paving the way towards a world without cash.