Singapore has conducted its maiden test of live bunker delivery financing using an electronic bunker delivery note (eBDN). The initial transaction was between TFG Marie and Ocean Network Express (ONE) and was facilitated by Asencz, DBS Bank, and the Singapore Maritime and Port Authority (MPA).
Presently, banks depend on physical copies of the BDN, which is inconvenient and increases the risk of fraud and exploitation. Mass Flow Meters are employed to digitize bunker deliveries, which enables parties to determine trade data at the point of origin.
“The digitization of bunker delivery notes is just one of several important measures required to shift Singapore’s bunkering sector into the digital world and to guarantee our port and shipping industry is ready for the future,” said Sriram Muthukrishnan, Group Head of Trade Product Management at DBS. ”
One of the goals is to collaboratively build a digital methodology that improves accountability and productivity for bunker trades while also developing confidence with banks and shipowners, both of which are crucial to the future progress and expansion of Singapore’s bunker ecosystem.”
Singapore is the world’s largest bunkering hub with respect to volume, having sold about 50 million tonnes of marine petroleum in 2020. Bunker finance, on the other hand, is now only available to clients through the use of physical reproductions of the BDN and other relevant documentation. As a result, customers must physically transport the actual BDN ashore for final compilation with other paper files before a trade finance application can be filed. This is a time-consuming procedure that normally takes several days. However, clients will be able to acquire finance for their underlying transaction in less than two hours now, thanks to the freshly digitalized approach, which will allow them to acquire working capital more quickly and effectively manage their cashflows.
The opinions expressed herein are the author’s and not necessarily those of News2Sea.
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