New Blockchain Model Trado Paves Way to Enhance Supply Chains

New Blockchain Model, Trado Paves Way to Enhance Supply Chains

As per a report, the University of Cambridge Institute for Sustainability Leadership (CISL) concluded a successful experiment that opened the gateway to a new blockchain model for global supply chains. The experiment, Trado, brought together a consortium comprising of Sainsbury’s, BNP Paribas, Unilever, Barclays, Standard Chartered and Rabobank.

The model was first experimented in Malawi’s tea supply chain wherein farmers were offered monetary incentives in exchange for furnishing social or ecological data. Naturally, the increase in transparency led to pre-shipment financing – sowing the seeds for long-term benefits of the 225 farmers involved in the chain.

Thomas Verhagen, Senior Programme Manager, CISL, said:

“This is a significant step towards further development and understanding of how technology-driven innovation can support the delivery of the UN Sustainable Development Goals. The Trado model has the potential for replication across a wide range of topics and we hope the blueprint will encourage others to deliver its potential for social and environmental improvement.”

Smallholder farmers form an integral part of producers in the supply chain. But most of these farmers belong to developing countries where the cost of borrowing is high. Trado aims to elevate these farmers from the clutches of financial burden. It is based on the provision of ‘data-for-benefits’ swap to benefit both the parties involved while providing reliable data pertaining to the sustainability properties of the produce.

The data will perhaps be useful in keeping a check on deforestation, land management, biodiversity, socio-economic development and to ensure distribution of Trado-based benefits. It is a win-win situation, especially for the suppliers who will eventually achieve the working capital at a lower rate.

 

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