DEVELOPMENT OF BLOCKCHAIN BASED LETTERS OF CREDIT NETWORK

Electronics and Communication Engineering

This project is to track Letters of Credit (LC) from the point of application to the point of settlement. An LC can also be called as a draft, documentary credit, or banker's commercial credit is a guarantee from a buyer to pay a seller according to certain terms and time periods. Banks will cover the entire amount or the remaining portion of the purchase if the buyer cannot pay. When parties who do not trust each other are involved in international trade, banking channels are used to make payments. In such situations, LCs are a common payment method. The issuing bank issues a Letter of Credit to a confirming bank, which pays the exporter in accordance with its terms. Due to its complex financial and administrative operations, the LC process is usually inef icient and time-consuming. Our main aim of the project is to overcome this limitation of LC by using blockchain technology. It is reported that global finance companies which do not follow this technology require 7 to 10 days of time for verification and authorization of an international trade transaction. But by using this Letter of credit with blockchain technology, it takes only 2.5 hours and this process is very secure.

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