Indian multinational giant Mahindra announced a partnership with IBM to jointly develop blockchain solutions to reshape Indian supply chain finance

Mahindra Group, one of India’s largest diversified multinational conglomerates, and IBM today announced that they are developing a blockchain solution that has the potential to reshape supply chain finance in India by improving security, transparency and operational processes.

Anish Shah, President, Group Strategy, Mahindra said:

“The Mahindra Group is pioneering the use of blockchain to disrupt traditional businesses and drive further growth. We are directly investigating the application of this technology in other areas of the Group such as financial services, automotive, mobility and agri-tech. This proof of concept will further promote blockchain as a more attractive and effective supply chain solution for Mahindra Finance’s SME lending business. Working with IBM, we will work to build, test, scale and refine this solution.”

Bill discounting – bundling and selling bills at a discount – is a primary source of working capital financing for many suppliers. This new solution aims to enable more suppliers to access credit in order to drive greater financial inclusion across the supply chain. Supplier-manufacturer bill discounting has historically been considered difficult, slow and risky, requiring each participating institution to maintain and manually update separate ledgers. Human errors in this process can lead to inconsistent records, ultimately resulting in delayed payments and a lack of access to capital.

Blockchain technology can help Mahindra Finance access transactions recorded on a shared ledger in near real time, allowing it to develop and offer new products to small and medium-sized enterprises. This is a radical process and technology shift that may push business development into the future.

Lula Mohanty, Executive Partner, IBM Global Business Services, said:

“Blockchain is poised to transform commerce as much as the internet did, and IBM is at the forefront of that revolution. We offer a comprehensive enterprise-grade blockchain solution that is secure, scalable and trustworthy. Our collaboration with Mahindra has the potential to fundamentally change how businesses interact with each other, with customers and with suppliers. We believe this type of engagement can be replicated, not just in the financial sector, but in a variety of other industries.”

IBM is rapidly expanding their blockchain consulting services and capabilities and is actively working with clients to understand how to enable blockchain to be integrated into business processes.

Through IBM's open source contributions to Hyperledger Fabric and the blockchain service on the IBM Bluemix cloud, developers can easily and quickly develop applications while testing the security, availability and performance of a permissioned blockchain network. IBM is committed to advancing the science of blockchain, helping to eliminate complexity and making it more convenient and open. Financial services, supply chain, trade finance and logistics, the Internet of Things, risk management, digital rights management and healthcare are all areas that may undergo tremendous changes due to the use of blockchain networks.

The Mahindra Group is focused on helping people rise through solutions that drive mobility, drive rural prosperity, enhance urban lifestyles and improve operational efficiency.

As a $17.8 billion multinational corporation based in Mumbai, India, Mahindra provides employment to more than 200,000 people in more than 100 countries. Mahindra drives economic growth in a number of key industries, with leading positions in tractors, utility vehicles, information technology, financial services and vacation ownership.