Invoice Factoring Solution On Blockchain
Technology and Tools:
Silex, mySQl, Redis (API websockets),
Angular 2 Blockchain: Parity + node.js
Invoice factoring is a financial transaction whereby a business sells its accounts receivable to a factoring company to free up their cash; usually to secure working capital to meet expenses, cover payroll or expand their sales. During the last two years, this market emerged and shifted towards leveraging the Blockchain technology to improve security, speed, and reliability of the services. A fast-developing European company (under NDA) specialized in online retail of goods for children reached out to us with a request to create a new factoring platform for their supply chain. Since classic factoring business is prone to high operation costs and slow factoring requests processing, the classical solution was not aligned with the company’s Agile and innovative culture.
The solution was to apply Blockchain which offered an automated low-overhead way of securing the transactions and enabling the use of smart contract technology. The main goal was to gain a competitive advantage due to the development of a solution using the top-notch technology leading to the highest security and reliability.
As a result of the business analysis, our project team came up with a high-level technical solution which included a combination of Ethereum and Parity for creating a modern and lightweight Proof-of-Authority mechanism and deploying Smart Contracts.
The back-end of the tool had two main nodes – 1) admin-panel and 2) public. Admin node was intended to provide synchronization of all invoices that were stored in the tokens using internal API. Internal API, in its turn, reached to the Smart Contract module enabling the use of abovementioned technology. Public node lets users get any requested information regarding the tokens. The initial infrastructure was deployed using AWS because of reliability and resilience of that service. The development team consisted of one front-end developer, one back-end developer, and one designer. The overall project duration amounted to eight months.
After successful delivery of the platform, it received positive feedbacks due to its automated and easy to manage nature. The factoring solution was initially meant as an internal product; it was later transformed into a B2B offering for other similar businesses and constituted a new line of business within the customer’s organization.