China’s Hainan Province launches blockchain cross-border finance platform

China’s support for blockchain technology has continued, with yet another province launching a blockchain project. Hainan province launched a blockchain-based financing platform that allows banks to offer a line of credit to companies in the export business.

The island province launched the initiative in partnership with the local branch of the Foreign Exchange Bureau. According to a report by Hainan Daily, the new platform will be used on two fronts, namely financing exports and cross-border credit information verification. In a pilot test, the Hainan office of the Bank of China was able to successfully transfer funds from a company in Hainan on the platform. The transaction was worth $1 million.

The use of blockchain has many advantages, the Hainan government believes. For one, it will facilitate the use of tamper-proof data for authentication functions in customs declaration forms. The participating companies will be able to submit their trade financing documents online. The banks will then directly verify the authenticity of the information. This process, which would take days, will be reduced to a mere 10 minutes.

The local branch of the Foreign Exchange Bureau will continue to “promote the blockchain platform to the province ’s banks, and actively promote the use of new application scenarios such as service trade external payment and capital project income payment facilitation to further improve the level of trade and investment facilitation,” the report states.

Hainan has been pro-blockchain for some time now. In December last year, the province’s Free Trade Zone pledged 1 billion yuan ($142 million) towards blockchain development. The fund is to be used in growing talent in the sector, investing in social projects and the development of blockchain applications.

The blockchain push in the province has attracted blockchain developers in the past two years. According to Chinese outlet Xinhua Net, over 100 businesses are now members of the Hainan Resort Software Community.

OK Group has also focused on Hainan, partnering with the local government last year to grow the blockchain ecosystem. The company pledged $140 million and is now building the Asia Pacific Innovation Center in the island.