Vnesheconombank has inked an agreement with Cognitive Technologies to develop a decentralized blockchain-based transaction network
It was reported on October 28, 2017, that Russian government-run Vnesheconombank (VEB) signed a cooperative agreement with Russian IT company Cognitive Technologies to develop a blockchain system to manage transactions between businesses and governmental participants.
VEB is the operator of large-scale exchange Unified Electronic Trading Platform (UETP) and will use its E-document flow system as the framework to integrate blockchain technology, bringing complete transparency to electronic contracts. The technology will aid VEB in terms of investments, project monitoring, procurement, electronic contracting, and tracing the supply and subcontractor chain, according to the report. UETP’s CEO Anton Emelyanov said his platform’s existing structure suits the deployment of a blockchain platform. He elaborated, “This technology will enable transparency across all supply chains and will enable interaction between customers and suppliers that will be as smooth as it is when smart contracts are used. Unified electronic trading platform has a well-developed infrastructure and the required technology expertise, so the project outcomes can be scaled up to enhance all other IT systems that will serve as groundwork for building digital economy in Russia.”
Sergey Gorkov, chairman of Vnesheconombank, described the project and role of blockchain technology:
“The Blockchain technology used as corporate governance and national government tool will help to achieve zero human factor impact, so transactions will become accurate and transparent. It will help us to sensibly reduce the service timeframes, boost the operating efficiency and strengthen the people’s trust with respect to public authorities and financial institutions. The system will be useful not only to the government, but also to business customers. The new mechanism will help businesses interact with their clients and suppliers, improve the document exchange quality, enable stronger data confidentiality and underpin the customers’ confidence in the product suppliers.”
The auspices of full transparency allow for independent auditing of transactions by any third party, enhancing business cooperation between entities that utilize the system. Cognitive Technologies will develop the software as a foundation for this transaction network. As described by Andrey Chernogorov, CEO of Cognitive Technologies:
“This Blockchain-network will make the procurement process 100% transparent. Any side of the process will be able to view its entire history from the moment of planning to the moment when the contract is executed. The Blockchain technology is one of the most effective tools against corruption schemes.”
Parties to the agreement are optimistic that the decentralized system will bolster participation between government entities and businesses.