Dialogue with Zhongan Science and Technology to discuss the solution of “Block chain + supply chain Finance”

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Zhongan Information Technology Service Co., Ltd. (hereinafter referred to as “Zhongan Technology”), founded on November 2, 2016, is a wholly owned subsidiary of Zhongan online property Insurance Co., Ltd. (referred to as “Zhongan Insurance”).

Zhongan Science and Technology focuses on the research of cutting-edge technologies such as blockchain, artificial intelligence, big data and cloud computing, focuses on the technology output of insurance technology in domestic and foreign markets, helps insurance ecological customers develop rapidly and of high quality, realizes universal benefits, and is committed to becoming a strategic partner for the digital upgrading of the global insurance industry.

Adhering to the innovation gene driven by the twin engines of “insurance + technology”, Zhongan Technology provides customers with proven technology, products and industry solutions. cover the key links of insurance management, such as product design, precision marketing, nuclear insurance and compensation, service and operation management, and empower the insurance value chain with science and technology. In the first half of 2019, the number of signed customers of Zhongan Technology exceeded 170, and the existing customers accounted for 64% of the total customers signed in 2018. In overseas markets, it has reached cooperation with well-known enterprises such as Japanese property insurance company SOMPO, Southeast Asian O2O platform Grab, and Income, one of the largest comprehensive insurance institutions in Singapore.

Binance Lab meeting.

Wang Yukun, content Director of Binance Lab:

Hello, everyone, the new issue of Binance Lab is with you again!

First of all, welcome today’s guest Chu Weiguo and guest host Yan Lijuan.

Yan Lijuan of Southwest Caida Block chain Research Center:

Hello, everyone. I am today’s guest host, Yan Lijuan from the China Block chain Research Center of Southwest University of Finance and Economics.

Wang Yukun, content Director of Binance Lab:

Yan Lijuan is an old friend of gold. Haha!

Let me introduce to you again:

Yan Lijuan, former Deputy Director of News reporting Center of Local propaganda Department, reporter of CCTV Securities Information Channel, founder of Global Youth warm Business Entrepreneurship Competition, currently works in China Block chain Research Center of Southwest University of Finance and Economics, Communications Committee member of Block chain Professional Committee of Chinese computer Society, academic member of Chengdu Sub-Forum of Chinese computer Society Youth computer Science Forum.

Wang Yukun, content Director of Binance Lab:

Next, I would like to solemnly introduce today’s guest Chu Weiguo:

Chu Weiguo, Director of Zhongan Technology / supply chain Finance Solutions.

Mainly responsible for Zhongan science and technology supply chain financial direction business solution consulting work. Twelve years of experience in information system construction and scheme consulting in financial banking and mutual fund industry, successively worked in Anshuo Technology, Neusoft Group, Ping an Financial account pass, Zhongan Science and Technology. During this period, he participated in leading the construction of information systems in the direction of public credit and financial markets in many financial banking institutions.

Chu Weiguo, Director of supply chain Financial Solutions of Zhongan Technology:

Good afternoon, dear friends. I am Chu Weiguo from Zhongan Technology.

one.

Wang Yukun, content Director of Binance Lab:

Welcome, Boss Chu.

Then let’s officially start today’s interview!

Wang Yukun, content Director of Binance Lab:

Block chain enabling real economy has been recognized as a general trend. Please introduce your personal opportunity to enter the field of blockchain, and talk about your understanding of blockchain.

Chu Weiguo, Director of supply chain Financial Solutions of Zhongan Technology:

I personally have been engaged in financial information construction work, early mainly engaged in financial bank information system construction, but also technical background, and then gradually turned to business solutions.

However, we have been paying attention to the development of information technology.

For the understanding of blockchain, more after joining Zhongan, we have a lot of professional students doing research and blockchain-related products.

When we have the opportunity to communicate and learn with them deeply, when we are making solutions for our customers, we will introduce blockchain technology into the solution when we encounter some suitable scenarios.

For the blockchain, first of all, we should have a clear understanding.

Blockchain is a kind of technology or mode, which has its unique technical characteristics (such as decentralization, tamper-proof, consensus trust mechanism, openness, etc.).

Solve some problems under certain scenarios.

The blockchain needs to be viewed objectively, constantly landing in the scene to practice and promote technological innovation.

two.

Wang Yukun, content Director of Binance Lab:

In July 2019, the China Banking and Insurance Regulatory Commission issued the guidance on promoting the real economy of supply chain financial services, requiring banking and insurance institutions to standardize the development of supply chain financial business, promote supply chain financial innovation, and improve the quality and efficiency of the real economy of financial services. we will further improve the financial services of small and micro enterprises and private enterprises. As the head of Zhongan Technology supply chain Financial Solutions, what characteristics of blockchain do you think are suitable for its application in supply chain finance?

Chu Weiguo, Director of supply chain Financial Solutions of Zhongan Technology:

Document 155 is quite morale-boosting for our supply chain finance practitioners.

Through the article No. 155 of the Banking Insurance Supervision, we can also find that at the regulatory level, we can also see that the development of supply chain finance plays a significant role in promoting the real economy of financial services, especially in improving the access of small and medium-sized enterprises and private enterprises to financial services.

It is hoped that financial institutions and core enterprises can develop supply chain finance business, and encourage people to actively introduce new technologies to develop supply chain finance business.

Why encourage the introduction of new technologies?

Because supply chain finance actually originated relatively early in China. As early as the 1990s, I remember that some domestic joint-stock commercial banks were already providing financial products related to supply chain finance (or trade finance). But it’s always in a tepid state.

The main reason is that when financial institutions are engaged in similar business, the input-output ratio is not suitable.

It is difficult to get customers, difficult to control risk, high cost of risk control, high rate of bad debts, typical thankless business, and the development within financial institutions is relatively limited.

Some new technologies represented by blockchain technology can break through some practices of the traditional supply chain financial model and improve the means for financial institutions to manage and control business risks.

At the same time, improve online operation, reduce risk control costs and operating costs, so that the entire supply chain financial service model to achieve a win-win situation, the model is sustainable.

For example, blockchain technology uses distributed ledger technology, which is jointly maintained by many parties, to share contracts, bills, invoices and other information in the supply chain to enterprises with authority, and connects core enterprises, upstream and downstream enterprises and financial institutions together. it solves the problem that the traditional supply chain financial information can not be transmitted and the data can not be stored and authenticated.

three.

Wang Yukun, content Director of Binance Lab:

For supply chain finance itself, which pain points can blockchain technology solve? What new value enhancements do you think blockchain + supply chain finance will bring?

Chu Weiguo, Director of supply chain Financial Solutions of Zhongan Technology:

There are three key points that we have come to know in practice.

First, break the phenomenon of information segmentation and information isolated island.

From the point of view of the customers we cooperate with, the non-exchange of information among enterprises in the supply chain and the phenomenon of isolated island of information is still serious, which restricts the cross-verification of financing information and improves the risk control cost of financial institutions.

Through the block chain technology to link all the relevant parties into an alliance, multiple stakeholders can set rules in advance to accelerate the exchange of data and the sharing of information.

Second, the problem that the credit of the core enterprise can not be transferred.

In the supply chain, there is usually a multi-level relationship between supply and sales, and the credit of core enterprises can only be covered by the first-tier suppliers and dealers with whom they trade directly. can not be transferred to the upstream and downstream small and medium-sized enterprises that need more financial services.

Introducing electronic credit voucher based on block chain to realize cross-level credit transmission of core enterprises.

Third, the efficiency of clearing and settlement is low.

Clearing and settlement can not be completed automatically, and there are more uncertain factors when multi-level supplier settlement is involved.

The introduction of block chain intelligent contract technology, based on the automatic settlement of intelligent contracts, reduce manual intervention, reduce operational risk, and ensure the security of payback.

Wang Yukun, content Director of Binance Lab:

A super-clear answer!

There is also a doubt, there is a view that the difficulty of financing for small and medium-sized enterprises is mainly due to the quality problems of some small and medium-sized enterprises themselves, rather than the problem of information asymmetry. In this context, do you think blockchain + supply chain finance can solve the difficult financing problem of small and medium-sized enterprises?

Chu Weiguo, Director of supply chain Financial Solutions of Zhongan Technology:

In the process of development of small and medium-sized enterprises, there are indeed many problems that need to be continuously improved in the aspects of financial standardization, operational stability, corporate internal governance and so on. it is also an important reason why it is difficult for traditional financial institutions to provide financial services to small and medium-sized enterprises according to the traditional credit model (credit assessment + risk mitigation tools).

Compared with the traditional credit model, it is promoted from the credit evaluation level of a single subject to the whole supply chain level.

Pay more attention to the credit of high-quality core enterprises in the supply chain.

Self-reimbursing trade financing is used to solve the financial service needs of small and medium-sized enterprises in the upstream and downstream of the supply chain.

At this time, we find that the operators or financial institutions of the supply chain financial platform need to timely grasp the information flow, capital flow and logistics related to the basic trade in the supply chain.

But as we mentioned earlier,

The reality is that these three types of information are usually scattered among different subjects in our supply chain system.

We need a means to integrate this information, and this is the important value that blockchain technology can play under the premise of data security and control.

Wang Yukun, content Director of Binance Lab:

Thank you, Boss Chu! Next, I’ll give the microphone to Yan Lijuan to continue the interview.

four.

Yan Lijuan of Southwest Caida Block chain Research Center:

All right, thank you for your hard work!

I just mentioned that blockchain technology can solve the pain points of supply chain finance, so please tell us how Zhong’an Technology uses blockchain technology to solve these problems.

Chu Weiguo, Director of supply chain Financial Solutions of Zhongan Technology:

Zhongan Technology has been working with some domestic supply chain technology companies since 2017 to try to apply blockchain technology to the supply chain and supply chain finance.

It was first in the pharmaceutical industry.

Take the hospital as the core enterprise, based on the accounts receivable of the upstream supplier to the core enterprise.

The core enterprise issues the electronic claim voucher based on the block chain, and supports the split, circulation and financing of the voucher on the chain, so as to realize the cross-level transmission of the credit of the core enterprise, so as to solve the financing problem of upstream multi-level suppliers.

Later, we did a simple statistic.

With this model, the average annualized financing price of upstream suppliers can be reduced by 2% and 3%.

After that, we expand our solutions for upstream suppliers to insurance, construction, agriculture, e-commerce and other industries.

For downstream dealers, we also work with domestic e-commerce platforms to create standardized electronic warehouse receipt vouchers based on blockchain to support electronic warehouse receipt trading and financing functions on external exchanges.

At present, Zhongan Technology’s supply chain financial solution has supported various forms of financing services for upstream and downstream enterprises.

Including accounts receivable financing, order financing, prepayment financing, warehouse receipt financing, etc.

We have also released a new supply chain financial services brand “Zhongguang Anchuan”.

five.

Yan Lijuan of Southwest Caida Block chain Research Center:

I just gave a brief introduction to the supply chain finance scenario in the pharmaceutical industry. what other scenarios have been applied at present? Could you introduce the relevant cases in detail, please?

Chu Weiguo, Director of supply chain Financial Solutions of Zhongan Technology:

At present, we have covered a number of upstream and downstream scenarios in the application of supply chain finance scenarios, among which the more representative scenario is the accounts receivable financing scenario for upstream suppliers.

It is also a large part of the large-scale development of supply chain financial transactions in China.

Take our case in the field of big consumption.

We worked with a factoring company in Guangzhou.

Based on the credit of the core enterprise in the industrial chain, the transaction structure of reverse factoring is adopted, which is based on the accounts receivable claims of the upstream supplier to the core enterprise.

Core enterprises issue electronic claim vouchers based on block chain to support the split, circulation and financing of vouchers on the chain, so as to realize the cross-level transmission of core enterprise credit.

Solve the phenomenon of triangular debt among enterprises in the supply chain and expand the financing channels of upstream suppliers.

In terms of specific operation.

On the industrial chain, the core enterprises sign reverse factoring cooperation agreements with financial institutions, and the core enterprises are conducting basic trade with direct suppliers and signing trade contracts.

After the direct supplier performs the contract and generates accounts receivable, the core enterprise will issue online electronic claim vouchers based on block chain based on trade information (contracts, invoices or statements, etc.) (the registered amount of vouchers is the same as the amount of accounts receivable).

After the direct supplier receives the electronic claim certificate issued by the core enterprise, there are three options.

First, the holding expires and the core enterprise is due to redeem it.

Second, when purchasing from its own upstream suppliers, the electronic creditor’s rights vouchers issued by the core enterprise shall be used for split transfer payment.

Third, if there is a demand for cash during the holding period, initiate an application for voucher discount to the cooperative bank of the core enterprise to obtain financing support.

By analogy, suppliers at each level have the above three options during the period when they hold electronic debt vouchers.

After the accounts receivable are due, the core enterprise will redeem the accounts payable, and the supply chain financial platform will automatically redeem the funds to the voucher holder, and complete the recovery and destruction of the electronic debt voucher.

Through the above scheme, we find that suppliers who are far away from the core enterprises (multi-level suppliers) and whose credit qualifications do not meet the access requirements of financial institutions can also rely on the high-quality credit of the core enterprises to obtain financial support from financial institutions.

five.

Yan Lijuan of Southwest Caida Block chain Research Center:

Blockchain technology solves the credit problems among supply chain financial enterprises and the difficulties of financing and high cost of small and medium-sized enterprises, so that financial institutions can serve small and medium-sized enterprises customers more efficiently, conveniently and steadily, and give likes for Zhongan Technology!

We’ve been talking about blockchain supply chain finance. Now let’s change the subject.

On October 24, after the 18th collective study on the development status and trend of blockchain technology conducted by the political Bureau of the CPC Central Committee, local governments, enterprises, financial institutions and other units at all levels began to concentrate on learning blockchain technology, and have explored the application scenarios of the combination of industry and blockchain technology. In which industry do you most favor the landing of blockchain technology?

Chu Weiguo, Director of supply chain Financial Solutions of Zhongan Technology:

Xi Jinping’s speech did bring blockchain into the view of more people, making more governments and enterprises begin to pay attention to the development and application of blockchain technology.

Blockchain has indeed entered a good period of rapid popularization and development. From the point of view of the government and enterprises actively exploring the application of blockchain, from the point of view of landing, I think it is more to look at the scene rather than the industry.

Combined with the technical characteristics of blockchain, when we need to use blockchain technology in the process of scene digital construction, we should introduce it instead of doing the opposite, holding the technology to find the scene, from the perspective of the specific scene, supply chain finance, commodity traceability, points, pass economy and other aspects are good landing scenes.

Yan Lijuan of Southwest Caida Block chain Research Center: boss Chu said so well!

Zhongan Science and Technology has ploughed the block chain industry for many years, and has done a lot of exploration of the landing scene of the block chain. Can you introduce the overall layout of Zhongan Technology in the block chain? In addition to supply chain finance, what other products and services are there? What scenarios are they facing?

Chu Weiguo, Director of supply chain Financial Solutions of Zhongan Technology:

Zhongan Science and Technology is an early domestic enterprise to carry out block chain technology research and scene landing practice.

We adhere to the way of combining industry-university-research, actively participate in the formulation of international standards and national standards of the block chain, and participate in the four group standards organized by the Institute of Standards.

It is not only an important step for China to seize the global discourse power of the blockchain, but also help the Chinese blockchain industry to gain the first opportunity in the formulation of international standards and avoid the lack of standard discourse power.

Wang Yukun, content director of Binance Lab: setting standards is excellent!

Chu Weiguo, Director of supply chain Financial Solutions of Zhongan Technology: at present, our focus is mainly on three aspects:

The first point is the technical breakthrough at the bottom of the block chain, including contract engine, contract language, consensus algorithm, account structure, privacy protocol, computing model and so on, so as to solve the problems of scalability, security and centralization of the block chain.

The second point is the combination of blockchain and cloud computing.

The third point is the application of block chain. In addition to supply chain finance, Zhongan Technology currently has corresponding landing practices in medical care, commodity traceability, public welfare, government affairs, copyright and points.

In the future, we also hope to make joint efforts with you to promote the innovation and development of blockchain technology.

Binance Lab sent a message.

Wang Yukun, content Director of Binance Lab: thank you, Chu Weiguo and Yan Lijuan, for your wonderful questions and answers. Finally, I would like to ask Mr. Chu to send a message to the new model of “blockchain + industry”.

Chu Weiguo, Director of supply chain Financial Solutions of Zhongan Technology: I hope everyone will actively embrace the upgrading of industrial informatization, pragmatically explore the application practice of blockchain technology in the scene, innovate constantly, and give full play to the technical value of blockchain.

Wang Yukun, director of Binance Lab content: with our excellent enterprises, the application of blockchain technology will be promising in the future! Thank you both again.

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