(MENAFN- Newsfile Corp) Clavis Fintech Says Blockchain Will Simplify and Secure International B2B Payments
Summary: Dubai-based Clavis reveals that blockchain technology will modernize and speed up international B2B payments.
Dubai, United Arab Emirates--(Newsfile Corp. - February 27, 2023) - Small and medium-sized enterprises (SMEs) will greatly benefit from increased simplicity and security by using blockchain technology to make international business-to-business (B2B) payments, Clavis Fintech Founder Kazi Monirul Kabir says.
According to Kabir, B2B payments in the traditional banking system rely on correspondent banks to get money to change hands, sometimes requiring multiple steps. These banks charge fees for almost every step along the way, increasing the cost of doing business. By using blockchain, businesses can cut out the correspondent banks, making the payment process simpler and cost less.
Kabir also says that, despite what skeptics may think, blockchain is also much more secure, because each transaction is easier to trace and verify.
'Each transaction on the blockchain is unique. There is no way to hide from and to where the payment is going. The entire blockchain's ownership is decentralized. You may fool one owner, but you cannot fool the entire chain. So that's why it's very transparent and secure.'
Kabir clarified that B2B blockchain payments are different from illicit cryptocurrency trading, which can be used for money laundering, cybercrime, or terror financing.
'B2B blockchain payment uses fiat currency, transforms it to a stablecoin cryptocurrency, then exchanges it back to fiat.'
Kabir believes that it is important for SMEs to adopt blockchain for B2B payments because these businesses are the main drivers of the economy. Many large businesses are mostly satisfied by the traditional banking system and have the scale to absorb higher costs. On the other hand, SMEs need all the help they can get.
'Small and medium businesses are responsible for the largest chunk of economic activity around the world, and they are the main drivers of economies and growth. As the world goes into post-pandemic recovery mode, these companies are becoming more and more relevant. While the payments they make are smaller, these are also more frequent - which blockchain can help facilitate.'
Kabir added that the changing business landscape is now even more conducive for the adoption of blockchain, as it can help simplify complex global logistics that are now more ecosystem-driven. For example, an e-commerce company in the US can have one of its suppliers in China, while another supplier is in Vietnam.
'Blockchain makes it easier to manage multiple supply chain participants. By adopting it, the e-commerce platform doesn't need to worry about manufacturing or even holding finished goods - it can just focus on the sales part. It's also easier to pay suppliers, warehousing providers, and logistics and last-mile delivery partners.'
Unfortunately, the SME sector, which is set to benefit the most from the technology, is a bit hesitant about it.
'So far, blockchain has been used by several global banks as a letter of credit. While there is a lot of talk around it, not much has been executed. There is also some execution in retail and consumer-to-consumer contexts, but there is minimal adoption at the B2B level. Why? Because small enterprises don't get that kind of priority. Small businesses follow the traditional banking system, but nobody has bothered to provide alternatives. It will take some time to bring businesses onboard the idea of blockchain, but it is very doable.'
To encourage widespread adoption of blockchain by SMEs, Clavis Fintech will launch its B2B blockchain payment platform, with the minimum viable product to be released in May, while the full platform will be released later this year.
'Clavis Fintech seeks to harness the post-pandemic boom in entrepreneurship,' Kabir says. 'We want to become an enabler for people who are finding new ways in their livelihood, especially with news that tech giants are letting go of a lot of their people. The pandemic has also driven the rise in remote workers, also known as digital nomads. We want to provide solutions for them, because they are being ignored by the banking system. Big banks want big clients, and small clients - such as those transferring $1,000 at a time or with $2,000 account balances - are expensive for them to maintain. Blockchain B2B payments can better serve small and medium businesses, and we also believe that the contestable space in B2B payments is huge, so Clavis Fintech wants to become one of the leaders in this space.'
Media contact:
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Source: The Newsdesk
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