Blockchain-based invoice factoring: From business requirements to commitments
Ettore Battaiola, Fabio Massacci, Chan Nam Ngo, Pierantonia Sterlini · VU Research Portal · 2019
Europe has the largest global invoice factoring market for over 1.6BEuro.The purpose of a factoring market is to address delay in payments of commercial invoices by buyers of good and services: sellers bring their still-to-be-paid invoices to financial organizations (factors) which provides an advance payment.The market further growth is hampered by a number of security issues such as the impossibility of factors to check whether an invoice has been already factored (double pledging).A global organization collecting all factored invoices could be a solution but all stakeholders (banks, factors, etc.) have various reasons to not wanting to share such data.In this scenario a distributed, blockchain-based implementation is the only way forward, We describe the security requirements and all key operations for a secure, fully distributed Invoice Factoring Market, hereafter referred to as simply the 'Market'.Our distributed, asynchronous protocol simulates the centralized functionality under the assumption of the availability of a distributed ledger.We consider security with abort (in absence of honest majority).* This work has been partly supported by the European Union through the European Institute of Innovation and Technology -EIT Digital under Task 18213 UNBIAS in the 2018 Action Plan (UNITN was involved in: Task 18213-A1802 -Activation of Community