The Agricultural Bank of China (ABC)has completed granting a loan worth $300,000 using a blockchain system. The bank for the first time tested the technology in one of its branches in Guizhou province.
The collateral was a piece of agricultural land, according to reports of a local news source. The blockchain system is spread across various node partners which include commercial banks, Resources Bureau People’s Bank of China and local government’s Land.
The bank said that Blockchain would streamline the manual process of loan approval and eliminate the problem of borrowers utilizing the same piece of land as collateral for applying to loans from different banks.
This initiative will bring forth wider access to businesses and farmers owning agricultural land in rural China. After completion of the initial test, ABC further aims to expand the application for issuing loans backed by other assets, such as real estate in future. The ABC is one of the largest state-owned commercial banks in China and also the fourth largest bank in the world(considering total assets).
Out of 26 publicly listed Banks in China, 12 have already started working on blockchain technology. The ABC is reported to have assets worth $3 trillion as of December 2017. It has also developed a decentralized network for issuing small unsecured loans by automated processes to agricultural e-commerce merchants.
