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SHIPNEXT: Blockchain to solve the problem of unpaid bunker bills

23 Jul 2018

The following statement was provided by Alexander Vavarenko, CEO and Founder of SHIPNEXT, to Manifold Times in regards to how blockchain technology will be able to benefit the bunkering sector:

One of the next plans on SHIPNEXT’s agenda is to improve the security and reliability of freight payments. The time when freight is fully prepaid to a carrier’s or ship owner’s account may soon be over. 

The traditional way of executing freight payments bears risks ranging from stolen freight to underpayments resulting from a carrier’s bankruptcy, or fuel meter challenges, or other contractual disputes. Payment disputes are not uncommon in the bunkering industry. In many cases bunker suppliers are held hostage, while noncredit worthy carriers and shipowners abuse their control of the prepaid freight and use the money to cover past debts.

SHIPNEXT plans to put an end to this by introducing a blockchain-based solution within their open source Smart Contract program. SHIPNEXT, an international shipping marketplace, has designed and developed an open source Electronic Bill of Lading that will confirm the execution of a Smart Contract and generate a freight payment.

SHIPNEXT will work with banks to issue their own utility tokens, Ship Tokens (SHPT), specifically for the purpose of shipping related transactions, making the use of these bank issued Ship Tokens more reliable and trustworthy. 

The bank-issued Ship Tokens will be used for “Smart” Freight payment. Particularly, the Freight will be placed on a Smart Contract which acts more like an escrow account, and paid in part for every significant phase of the delivery process. The payment itself will be done on the blockchain and secured by Smart Contracts. 

Most significantly, ShipNext’s Ship Token system will solve the problem of unpaid bunker bills. It may be secured and paid by the shipper (shipper’s bank) straight to the bunker provider. The payment will first be completed in Ship Tokens (SHPT) in exchange for proof of the bunker supply, bunker survey documents and mater’s bunker delivery note, and easily exchangeable into fiat currency on demand. 

Photo credit: SHIPNEXT
Published: 20 July, 2018


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