Chapter 3. Blockchain Disrupting Supply Chain Finance: Transformative Solutions and Emerging Challenges

Purpose: The study aims to provide a concise summary of the adoption of blockchain technology in supply chain financing and value creation and explore how blockchain technology has revolutionized and optimized traditional supply chain finance practices. Study Design/Methodology: This study dives into the dynamic landscape of supply chain financing, highlighting the recent trends in supply chain financing and innovative approaches revamping the traditional supply chain financing models. It provides a comprehensive review of the available blockchain-enabled supply chain financing literature. Methodology/Approach: The study takes a multidisciplinary approach, drawing on insights from supply chain management, finance and information technology to understand the potential and challenges of blockchain technology in supply chain financing. Initially, the chapter examines the area of fintech innovations relevant to supply chain finance. Findings: The study on blockchain technology disrupting supply chain finance infers that blockchain offers numerous advantages for optimizing supply chain financing, such as faster settlements, reduced financing cost, limiting intermediaries, real-time settlements, and enhanced transaction efficiency. Blockchain in finance also suffers from drawbacks such as issues relating to scalability, regulatory compliance, privacy and security of data, and problems relating to educating users. Practical Implication: This study would be helpful for practitioners and future researchers of blockchain-supported supply chain financing. It contributes to the growing research on the applications of blockchain technology in supply chain finance, highlighting the advantages, disadvantages, and challenges of implementing blockchain technology better.