Abstract
Inventory pledge financing (IPF) is a crucial financing way for small and medium-sized enterprise (SMEs). But banks are reluctant to finance SMEs due to fraudulent risk in practice. This paper discusses the application of blockchain in IPF, particularly its impact on mitigating fraud risks. Utilizing game theory models, we illustrate how the finance and operation decisions of participants, along with supply chain efficiency, are influenced by the introduction of blockchain. Meanwhile, equilibrium outcomes are analysed and numerical study is given. Our analysis reveals that under certain conditions, blockchain integration can lead to reduced loan interest rates, lower wholesale prices, increased order quantities by buyers, and enhanced supply chain efficiency. Lastly, we develop a protocol to demonstrate the transfer of digital warehouse receipt on a permissioned blockchain to avoid fraudulent risk. This study provides a theoretical foundation, and a guidance for decisions-making in blockchain-enabled IPF schme.
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
