BBVA and Repsol finalise revolving credit facility based on DLT
BBVA and Repsol have just closed a revolving credit facility (RCF) which uses distributed ledger technology (DLT) for corporate finance.
Negotiation of the long-term credit line worth €325 million was completed using BBVA’s blockchain network, which sped up and increased security and reliability throughout the process, according to the bank.
BBVA is pushing bilateral corporate loans by showing its viability for revolving credit facilities, but it has said this tech still requires further development from a regulatory and technical point of view.
Repsol already has a lab for its lines of development in improving financial processes with added security and efficiency and advances in the supply chain and client fidelity.
The solution uses different types of blockchain: the negotiation was supported by a private blockchain network (Hyperledger), while the signed contract was registered used the Ethereum network (testnet) through a hash.
During a presentation in Santander, Spain, Alicia Pertusa, head of strategy and blockchain at BBVA, noted that the private side of DLT has allowed financial institutions such as BBVA to take forward improvements in processes in areas such as payments, the issue of securities and international trade as well as in projects focused on digital transformation.
BBVA forms part of the main international consortia looking to create standards such as R3, Hyperledger, Enterprise Ethereum Alliance and Spain’s Alastria.
Pertusa underscored the primary need for regulations that protect users while encouraging innovation. She said DLT needs to be more robust, facilitate scalability and have inter-operational standards that guarantee communication among different networks.
The agreement follows BBVA’s strategy to leverage blockchain applications, as seen in April’s reveal of BBVA and Indra’s corporate loan tech. Earlier this week, BBVA CEO Carlos Torres Vila announced that the group will begin testing the negotiation and contracting of syndicated loans using blockchain.
