Leading Spanish bank, Banco Bilbao Vizcaya Argentaria (BBVA) announced about being the first ever global bank which issued a loan which was entirely based on Blockchain technology. The announcement was made recently by the Financial Times.
According to the representatives of the Spanish multinational bank, the team conducted the entire loan process starting from the initial negotiations of terms and contract signing to the issue of the loan based on mutually distributed ledger. The approach allowed keeping the parties of the contract including the bank and the borrower completely informed and connected during the entire progress of the loan issuing process.
As reported by the BBVA representatives, the negotiations on large amounts of loans which in this case was worth €75 million, usually take several days while by using the Blockchain technology the time for negotiations was decreased to several hours. BBVA described the new approach as “significant advance” in using the new technologies in the financial market. It was also commented that blockchain technology can be especially useful and beneficial to be applied in the processes of larger corporate loans which are complex and usually require more resources and data to be applied compared with other types of landings.
After the first blockchain based loan was issued, the CEO of BBVA, Carlos Torres Vila announced that the bank already made several more successful transactions which were based on these new technologies. After a successful experience the bank made a decision of launching a pilot program together with Indra which is a leading Spanish telecommunication company. The program will be using the new technology to conduct the negotiation processes within loan issuing process and then it will be completed on Etheruem.
In addition, BBVA is developing Blockchain applications for sectors such as international trade, international lending, and foreign exchange which promise interesting future developments for their entire processes.