TOKYO -- NTT Data, Mitsubishi Corp. and five other Japanese companies are forming a venture to shift transactions online using blockchain, Nikkei has learned, after new Prime Minister Yoshihide Suga made it a priority of his government to digitize the economy.
Seven Japanese companies -- including MUFG Bank, Toyota Tsusho, Kanematsu, Sompo Japan Insurance and Tokio Marine & Nichido Fire Insurance -- will jointly invest in the company that will operate the trade information management system, developed by NTT Data. It plans to start offering the service by the end of this fiscal year, sources said.
The new venture aims to draw about 400 companies as clients in Japan and overseas. The system uses blockchain technology to ensure that data cannot be tampered with.
In addition to managing orders and receipts for exporting and importing companies, the digital trade transaction services will offer letters of credit issued by banks and related documents handled by insurance and logistics companies.
As governments across Southeast Asia also are promoting the digitalization of trade transaction, the group plans to expand the platform to enable the exchange of the digitized data with systems in other countries.
The Suga cabinet, which took office in September, has made digitization of the government a top priority. The companies see opportunity in digitizing government processes that until now have relied on paper trails.
A single export transaction can produce more than 20 types of documents. In NTT Data's trade management system, called TradeWaltz, a company would input information online, which the receiving company could then check online.
In trials by Mitsubishi Corp. and others, the time required to prepare documents has been reduced by almost half from the traditional method of filling out paper documents and mailing them.