Blockchain startup Fluent can help you solve supply chain management problems

The global import and export business generates billions of dollars in profits every year, but also causes a lot of losses due to risks, fraud and delays. Fortunately, blockchain technology, which has emerged in various industries and has received a lot of investment, has the potential to improve the efficiency of international trade.

After the economic crisis in 2008, the volume of international trade has continued to rise steadily, and the basic structure of the foreign trade industry, which consists of supply chain management and financial trade, has become increasingly mature. However, the increasing complexity of the review process has also brought some inevitable potential risks.

Supply chain management refers to the management of a series of processes from raw materials to products and then to consumers. This process involves a large number of companies, each of which plays its own role in the supply chain, such as processing, inventory management or quality inspection. The above processes constitute a complete supply chain, and the supply chain is completed when the final product reaches the consumer, which involves many physical and financial transaction processes.

However, global supply chain management is much more complicated. The transactions in the middle involve not only goods, but also handwritten documents (or messy electronic documents), such as purchase orders, invoices, bills of lading, customs documents, certification documents, etc. No matter which stage the order is in, goods tracking and inventory checks must be carried out in real time, especially some manual processes are prone to errors, losses, goods damage and even fraud.

Currently, many blockchain startups advocate the use of blockchain technology to solve physical and financial transaction problems in the supply chain. Blockchain provides a shared ledger that is open to multiple parties. It is immutable, secure, transparent, and open to multiple parties, which helps to check goods during the supply chain process.

After the goods are delivered from the seller to the buyer, the payment process occurs. Financial service companies need to ensure that the payment process goes smoothly (collection, etc.), which belongs to supply chain finance or financial transactions. Cross-border transactions involve many banks, so the process is very complicated.

The financial transaction service provided by the bank is called the guarantee agency business, which means that the bank advances the payment for the buyer before the goods are received. The bank will charge the seller for this service (4%-8% of the payment). Imagine if the buyer delays payment or even refuses to pay at all, then this business will cause huge losses to the seller.

For all transaction participants, the payment guarantee agency business involves multiple risk factors, including rejection, duplicate payment, false reporting and even fraud. Apart from these risks, the labor cost involved in transaction processing is very high.

Judging from the development of blockchain startup Skuchain and supply chain startup Fluent, blockchain technology can be used to solve the efficiency problems mentioned above.

Fluent CEO Lamar Wilson said:

At present, the financial transaction services provided by banks require the mobilization of a large number of human resources to complete investigations, document processing, etc. This leads to high service fees, while the profits of the foreign trade industry are shrinking and it is simply unable to bear the expensive fees.

Founded in 2014, Fluent provides blockchain services to banks, large enterprises and lenders. Its services include those that can be used in real-time B2B payments, supply chain finance and P2P operational capital markets.

The blockchain services provided by Fluent effectively help suppliers solve existing financial transaction problems:

1. Invoices will be marked after being verified by buyers to prevent duplicate and fake invoices.

2. Accounts payable can be divided among multiple lenders, who work together to purchase the amount on the invoice to help sellers reduce risk and cut costs.

3. No more tracking and consolidating remittance information. The data on the invoice can be uploaded to the blockchain, and since it is immutable, buyers can rest assured that they will pay.

Since its inception, Fluent has successfully raised $2.5 million from multiple sources (including Digital Currency Group, Fenbushi Capital, and more than a dozen other venture capital firms). Recently, Fluent announced that Kangmei Bank of America has become its first client.