‘Smart contracts’ use blockchain technology to boost online security

For financial services, a smart loan contract allows automatic enforcement of the contract on repayment, penalties and other conditions.
Sathapon said all business processes, in fact, could use the blockchain smart-contract service. 
Besides financial and related services, e-commerce for both domestic and cross-border sales of farm produce and other commodities is another target.
“The blockchain technology helps create trust between buyers and sellers in the world of e-commerce, especially for small online vendors that cannot be served economically by commercial banks.
“Traditionally, exporters have usually relied on banks’ letters of credit and related services to secure payment for their products. But banks cannot serve small vendors because of the relatively high operating costs.
“For example, we’re helping small rubber farmers sell online to buyers in China |using the smart-contract platform as the secured financial intermediary to ensure proper payment in a way similar to the L/C system.
“Money will be disbursed to the seller only when the buyer gets the right product and confirms payment for the goods. 
“In the process, the funds cannot be withdrawn ahead of this confirmation.
“In other words, smart contracts can protect the interests of both buyers and sellers, especially for e-commerce, insurance and other financial services such as loan providers.
“Insurance companies are also interested in the smart-contract platform, and so are e-commerce operators.
“At present, many vendors shift the risk to buyers by saying that they should be trusted and buyers should transfer money for the products to their bank accounts before the goods can be delivered.
“They may also ask buyers to read positive reviews on social media about their products. 
“However, there is no guarantee for buyers, so the smart-contract platform can be helpful. “These smart or online contracts may include conditions requiring sellers|to return money in an escrow account|to buyers if the products concerned |cannot be delivered within a certain period of time.
“Besides small e-commerce vendors, smart contracts can also be used for apartment or condominium rental contracts. Automatic enforcement is possible for smart rental contracts. 
“For manufacturing, smart contracts are also useful. 
“For example, a local auto-parts company has [begun using] the blockchain smart-contract platform to boost efficiency in the production process.
“In this context, a smart contract can be used to track the movement of raw materials for parts production and allow traceability if there are product defects.
“ This helps speed up and boost efficiency for the quality-control process for auto parts, electronics and other supply-chain-based manufacturing industries. 
“Electronic payment can also be linked with the blockchain smart-contract platform to allow more efficient money transfer among parts manufacturers and their suppliers of raw materials.
“However, there are still some legal challenges if smart-contract cases go to court, since the current judicial system is still used to traditional paper-based contracts. 
“Judges may not be familiar with digital or online contracts at this stage.
“But regulators, especially the Bank of Thailand and the Securities and Exchange Commission, are now better prepared| for the digital contracts, since they already have special teams taking charge of these matters.”