A memorandum of understanding was signed by the banks in Brussels indicating they intend to collaboratively develop a new product called Digital Trade Chain (DTC), which utilises distributed ledger technology.

The European banks in the consortium are Deutsche Bank, HSBC, KBC, Natixis, Rabobank, Société Générale and UniCredit.

The product is based on a prototype developed by Luxembourg bank KBC which won the Efma Accenture Innovation Award for ‘Best New Product or Service of 2016’ in October.

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This trade finance and supply chain solution – which has been tested to the ‘proof of concept’ stage – will enable the connection of parties in a transaction online and through mobile devices.

A KBC spokesperson said: “This new product will simplify trade finance processes for SMEs by addressing the challenge of managing, tracking and securing domestic and international trade transactions.

“The platform’s end-to-end transparency will also give SMEs confidence to initiate trade with new partners in their home market or in other European markets.”

Initially a scalable version of DTC will be launched focusing on European markets, including Belgium and Luxembourg (KBC), France (Natixis, Société Générale), Germany (Deutsche Bank, UniCredit), Italy (UniCredit), the Netherlands (Rabobank) and the UK (HSBC).