Lender Ventures Into Logistics on Blockchain

Union Bank of the Philippines (UBP) on Wednesday signed a strategic partnership with technology firm and logistics solutions provider Shiptek Solutions, Corp. to roll-out an end-to-end logistics platform on blockchain.

Under the deal, UBP will acquire 30 percent holdings in Shiptk and occupy two of five seats of the board of directors and enable the bank to integrate its digital financial services into Shiptek’s XLOG shipping and logistics platform.

"In terms of current volume, we're doing well on our way to the mid to high thousands in the past six months. In terms of users, we want to bring in one company and not just use it as a booking platform. We want them to use it as their entire logistics operations to be able to monitor their shipments, documentations,” said Shiptek chief marketing officer Nico Gonzales.

Shiptek was established in 2016. Last year, it launched its main product, XLog, a homegrown end-to-end supply chain solution designed to consolidate shipping, warehousing, trucking and customs brokerage.

Gonzales said that with the support of Union Bank, Shiptek could hit its projected target of 500, 000 to 1 million TEUS (Twenty-Foot Equivalent Units) by the end of the year. TEU is used to measure a ship’s cargo carrying capacity.

Aside from its e-commerce payment gateway, UBX is also integrating a loan system into the XLog platform.

Gonzales said the partnership with Union Bank enables Shiptek to expand its platform in the Philippines as well as in other projected international expansion points:  Singapore, China, Hong Kong, the Middle East, and India. The company looks to increase its footprint in the latter part of the year.

Gonzales said that global trends point to digital booking platforms but the country will have to maintain person-to-person transactions while slowly digitizing the system for the transition to occur "without as much frustration."

"The personal touch is still required but that doesn't mean we can't digitize or optimize some of the processes that go in between those human interactions," he said.

For his part, Union Bank’s head for platform development said UBX is also looking into the possibilities of embedding banking into healthcare, education and other ecosystems.