IBM (NYSE: IBM) and Santiago Exchange have announced a partnership to introduce blockchain technology across Chile’s financial sector. The agreement makes the venue the first stock market in Latin America to apply the technology within its short selling system for securities lending.

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“The Stock Exchange is a technologically advanced company, which provides the infrastructure and systems for all types of securities transactions and their clearing and settlement. The Stock Exchange also provides information services and management systems for intermediaries. Incorporating blockchain into our business processes is in line with that purpose and positions us as a forerunner in the financial market,” said Andrés Araya, CIO of Santiago Exchange.

IBM Chile General Manager, Francisco Thiermann, highlighted the fact that the Santiago Exchange is the first stock exchange in Latin America to implement a securities lending blockchain solution: “Our agreement with Santiago Exchange marks another new era of innovation in the stock market. Santiago Exchange is a pioneer in its industry, and the blockchain adoption establishes a transformational precedent in the financial market, not just in Chile but in this region and the world,” he said.

The blockchain solution developed by IBM is based on the open source Linux Foundation’s Hyperledger Fabric. It is designed to help reduce errors, possible fraud, and processing time for each transaction, while also improving transaction management and lowering costs. The developers say that the solution will result in significant time savings for the back-office processes of the Santiago Exchange.