According to a report published by China Daily on 2nd November 2018, China-based Tencent (OTCMKTS: TCTZF) has entered the blockchain trade finance space through its FinTech unit Tencent Financial Technology. The company has publicized its plans to create a blockchain-powered supply chain finance solution dubbed WeChain. The solution will boost the medium and small-sized businesses by assisting them in escaping financing predicament, mentioned ‘Aaron Cai’ the general business manager at Tencent Blockchain.
There are reports of Tencent signing agreement with Linklogis to create the supply chain solution. The solution will enable the corporate users of WeChat to gain access to trade finance right through their smart devices as Tencent aims at promoting data security and credibility in trade finance processes through the blockchain.
The new platform thus developed will be different from the traditional supply chain finance. The platform will have a blockchain technology which will spread a company’s good credit to various levels of the industry chain. This will prove exceptionally beneficial for small as well as mid-sized companies, according to a statement by the Managing Director at Linklogis Ji Kun.
Tencent is currently focusing on providing financial and SMB services that will restructure and refocus on how B2B operations are perceived. In October, China Channel hinted at Tencent’s restructuring announcement which the CEO Pony Ma explained as a new venture for Tencent in the coming 20 years. In 2017, Ma hinted at the company’s focus on the B2B industry.
From the management perspective the major issue that the company faces is an internal organization as stated by Ma in its annual internal staff meeting held in December 2017. As of now, the company needs to better focus on B2B business, said Ma in a press release.
Many people focus entirely on B2B, as stated by Tencent president Martin Lu. B2B, however, is not the core focus area of the company as company will need to first better understand B2B to be able to serve the sector properly.
There are also certain reports that hint at cloud services of Tencent as being the focal point for the firm’s enterprise-facing operations as the company progresses to compete with its rivals like Alibaba which provide dedicated Alibaba Cloud enterprises cloud services.
There are many companies that have transited to blockchain technology as a mean to improve productivity and efficiency. The blockchain technology is nowadays preferred more for secure communication channel and easy mode of operations. There are many companies that have already adopted blockchain in their process, while there are also many who are yet to adopt it.
Tencent’s move to blockchain will enable it to set a tough competition to its rivals and better position itself in the market that is growing to adapt latest technology. As of now, the blockchain technology has been adopted by financial institutions, research centers, tech companies and more. The company is likely to make further announcements regarding its plans with WeChain in the near future.
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