Trade Finance Future-state process depiction Establish payment terms Deliver goods Settle on terms Order goods Initiate Verified Verified Product Receive Provide invoice shipment goods goods shipped goods 1 4 5 6 Importer Exporter Exporter Inspection Customs Freight Customs Importer Import bank Smart Smart company Country A Country B Smart contract contract contract 7 Initiate payment Financial 3 2 agreement + + + Shipment Letter of Shipment Smart Payment Import bank Export bank initiated credit received contract complete Export bank Future-state process description 1 Following the sale agreement, 3 The export bank reviews the letter of credit; once approved a smart 7 Theimporter digitally the financial agreement is contractis generated to cover the terms and conditions of the letter acknowledges receipt of the shared with the import bank of credit goods,which initiates payment through a smart contract 4 The exporter digitally signs the letter of credit within the smart from the import bank to the 2 The import bank reviews the contract to initiate shipment export bank via a smart contract arrangement, drafts the terms 5 Goods are inspected by a third-party organization and the customs of the letter of credit and agent in the country of origin (all requiring a digital signature for submits it to the export bank for approval) approval 6 The goods are transported by freight from Country A toCountry B and inspected by local customs agents prior to being received by the importer WORLD ECONOMIC FORUM | 2016 79