LEADERSHIP SERIES
Instrumental Change In the first of the MEA Finance Leadership Series video interviews, we talked with Frank Wendt Co-Founder and Chairman of the Board at FQX AG, the first market-ready solution for eNotes™ built on a banking-grade Blockchain (Swiss Trust Chain). Here in a directly transcribed summary of the video, he discusses eNotes™ and the role they will play in world trade, business and finance
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h a t key fa c t o r s distinguish eNotes™ from other digital payment or promissory options? First of all, I think it makes sense to define what is actually an eNotes™. An eNotes™ is an electronic equivalent to a paper based promissory note. Now, a promissory note is an instrument that is a security and has many functions. One is the function as a payment instrument, being a buyer and a supplier, but also as a debt or credit instrument, which means a borrower and the lender, and thirdly, you can even add that it’s a collateral instrument or it can function like guarantee. The beauty is it is fully standardized globally, based on common law, but also the Geneva Convention (of) 1930. And it is today fully understood, it is a very uncomplicated security which is negotiable transfer.
What are their performance advantages over other methods? Now, if you look at what are the other methods, so, it could be that you look
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at factoring, reverse factoring which is very often used in trade finance, open account trading. The beauty is that you can at source, securitize payables, but also purchase orders pre-shipment and post-shipment and transfer them to the holder of, the best holder, be it the fund, be it the bank. So, it’s becoming negotiable and that means it is transferable and this means for many investors, that they can actively manage their portfolios and the balance sheets. The other benefit is that everybody knows about it already and that it’s fully electronic. That means you don’t need to use paper anymore in any way or form. And that is a big advantage if you look at global scalability.
Why do you think that FQX was the first market-ready solution for eNotes™? I think life is sometimes a bit funny because I used to work for an SCF, a Supply Chain Finance house and then I had discussions with some bankers and then I said, you know, all the solutions I see have always one or the
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Frank Wendt Founder and Chairman, FQX
