BEIJING, Feb. 14 (Xinhua) -- Shenzhen Zhongzhuang Construction Group Co., Ltd. (002822.SZ) has recently signed a strategic cooperation agreement on blockchain business with the Shenzhen branch of the Bank of Communications (BOCOM), according to the company's filing to the Shenzhen Stock Exchange on Thursday.
As a leading company in China's architectural decoration industry, Zhongzhuang Construction last year developed a blockchain financial platform, connecting five types of participants of the industry, such as financial institutions, tax departments, project contractors, upstream suppliers and customers.
According to the agreement signed, the BOCOM, one of China's five major state-owned banks, will join in the platform as a cooperation partner and provide Zhongzhuang Construction and its affiliated companies, downstream and upstream enterprises, as well as enterprises on the platform, with innovative financial service products.
Meanwhile, the bank will provide Zhongzhuang Construction with supporting financial products and financing services for its tailored transformation of blockchain and supply chain financial platforms.
The Shenzhen branch of BOCOM will grant a total of 800 million yuan of intentional credit for Zhongzhuang Construction in the next year, said the agreement.
The signing of the agreement marks a further progress of Zhongzhuang Construction to develop blockchain business, following its cooperation with the Shenzhen branch of the Agricultural Bank of China, the company stated.
It is conducive to the establishment of a long-term and stable strategic partnership between the company and BOCOM, helping the two sides integrate respective advantage resources to achieve beneficial economic outcome, said Zhuang Zhong, president of Zhongzhuang Construction.
It is learned that the major players in the architectural decoration market are small and medium-sized enterprises, who often face great pressure in terms of receivables and capital flow. Traditional financing channels, such as banks, trusts, funds, offer very limited services or financial products for such enterprises, which limits the development of the companies and the industry.
The blockchain financial platform launched by Zhongzhuang Construction last year is aimed at solving the problem, Zhuang said.
By using blockchain technology and authentic data, the platform can enhance trust between the major participants, help upstream suppliers get loans that were used to be difficult to obtain, and reduce the cost in the financing process, noted Yu Guitian, deputy general manager of Zhongzhuang Construction.
Meanwhile, through the blockchain platform, financial institutions can further extend their financial services to the architectural decoration industry, and better carry out related business such as factoring, risk control for credit extension, and post-loan examination, added Yu. (Edited by Su Dan)