5 Things You Need to Know about Electronic Bill of Lading (eB/L)
With more new digital courier platforms on the market, the days of trading physical paper bills and transferring them via a physical courier may be numbered. In fact, the COVID pandemic has rapidly accelerated the adoption of electronic bills of lading, making it a far more widely accepted option in the shipping industry. Whether you are an Exporter, Importer, Freight Forwarder, Service Provider for international trade between exporters and importers, or a bank, make sure to read this article before you dip your toe in the water of electronic bills of lading services.
#1 eB/L services offer a modern and digital approach to BL transfer
Electronic bills of lading are a digital alternative to traditional paper and courier services that enables instant, authenticated transfer of original electronic bill of lading documents. Some eB/L solutions provide a complete mirror of the paper process with the exception that paper documents are now digital and the transfer is executed via peer-to-peer blockchain technology rather than courier. In other eB/L solutions available on the market the digital transfer is done via a cloud-based system.
#2 eB/l is superior to paper/courier in terms of speed, cost and security
Digital courier solutions offer the well-known benefits of the paper process - mainly full independence of the parties - while eliminating the downsides. No longer is there a physical paper document that can be lost, forged, mislaid, damaged or destroyed. eB/L also offer significant cost savings since there is no paying for courier fees or insurance, and the time-saving aspect that comes from cutting transfer times from weeks to minutes is huge.
#3 eB/Ls protect business continuity
A cup of coffee accidentally spilt on a paper bill of lading or a B/L lost by a courier service can spell disaster. Organizing a replacement bill of lading to be issued at short notice is not just a major headache, it can cause serious delays and disruption to a business. Stored in digital format either in the cloud or on a blockchain network, eB/Ls are always accessible and arrive with entities minutes after they are transferred, allowing trade to flow seamlessly.
#4 eB/Ls offer greater peace of mind and security
As we mentioned above, since eB/Ls are stored and transferred either in the secure cloud or via peer-to-peer blockchain platform, and are digitally signed and encrypted, there is virtually no risk that the bill of lading will be forged, manipulated or stolen (as is the case with paper-based models!). At the click of a button, you eliminate most of the risks inherent in trading by paper and via courier. Decentralized eB/L solutions based on blockchain technology can provide incomparable security and privacy between two transacting parties. Eliminating the middleman minimizes the risk of someone being exposed or the data being manipulated, or the risk of the middlemen being hacked.
#5 eB/Ls can overcome the problem of short routes
Trading by paper is really not conducive to short legs of 1-2 days. In fact, it is not uncommon for the paper bill of lading not to arrive in time to release the cargo, resulting in costly delays. Since eB/Ls are transferred at the speed of digital, not at the speed of courier, cargoes can be released on time even on short legs.
One last thought
In today’s market, the majority of eB/L services are based on a centralized architecture, where accounts are hosted by a central entity that acts as a “middleman” controlling the identities, accounts and data of transactions. For companies seeking full autonomy and control over their trades, a decentralized peer-to-peer - that closely mirrors today’s paper and courier process - is preferable since users are the sole owners of their data and no external party is able to view identities or control the transactions.
To learn more about how decentralized electronic bills of lading systems can streamline your business while keeping you in control, click here or