Authorities in Beijing say they have launched a blockchain-powered loans platform that will help small and medium-sized companies affected by the coronavirus to borrow money and potentially stay afloat – as the disease threatens to batter the city’s industrial sector.
The city’s government launched the platform as part of new emergency measures, per a February 9 report from media outlet the People’s Daily.
SMEs have been among those hit hardest by the virus, with the government extending the Lunar New Year holidays in an effort to limit its spread. Although many companies have reopened for business today, a large number of firms in the city are only partially open, with many staff members working from home.
SME productivity in the capital has been severely hampered and could worsen if staff and partner companies do not resume business as usual in the coming days.
The media outlet says the blockchain-powered platform will allow small, medium and micro enterprises to obtain loans from government agencies, as well as three participating banks.
The authorities have also spoken about “aggressively promoting” blockchain-powered debt management platforms as the virus continues to disrupt lives and business in the capital, with state-owned research institutes and other local governments also getting involved.
The platform offers services including insurance guaranteeing, investment assistance and emergency loans.
The authorities state that using blockchain technology will help boost transparency, prevent false rights issuances and ensure all parties stay abreast of one another’s’ financial statuses.
Meanwhile, insurance service providers rely on blockchain to fast track claims payout amid coronavirus outbreak. Per the South China Morning Post, coronavirus outbreak has placed at least 27 mainland Chinese cities on lockdown and forced many Hongkongers to work from home. Therefore, a collective claims-sharing mechanism built on blockchain technology that offers basic health plans to its 104 million participants, Xiang Hu Bao, in mainland China, added the coronavirus as a critical illness eligible for a maximum one-time payout of 100,000 yuan (USD 14,325).
Ant Financial, an affiliate company of the Chinese Alibaba Group, owns the platform and will fund the payout with its own capital. In Hong Kong, Blue Cross Insurance, a unit of Bank of East Asia, is using blockchain-backed claims service, to eliminate the paper process, speed up the claims process, and reduce need for face-to-face contact.